When a Company Calculates Its Product Unit Cost Using Estimated

question 76

Multiple Choice

When a company calculates its product unit cost using estimated costs, it is using which cost measurement method?

• A) Standard costing
• B) Actual costing
• C) Full costing
• D) Normal costing

Comprehend the rights and benefits of holding patents, copyrights, and trademarks, including their useful life.

Understand the concept and accounting treatments of amortization, depletion, and depreciation.

Differentiate between tangible and intangible assets, including their classification and valuation.

Recognize the financial reporting of natural resources and the computation of depletion.

---

Definitions:

Materials Quantity Variance

The difference between the expected amount of materials needed for production and the actual amount used, affecting production costs.

Standard

Typically refers to an accepted level of quality or achievement that is used as a measure, norm, or model in comparative evaluations.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a specific product and are an integral part of the finished product.

Actual Price

The price at which a good or service is sold in the market, as opposed to its listed or theoretical price.