The method of estimation of cost function, by making the opinions and analysis about cost and cost drivers is classified as ______?

Correct answer: A. conference method

  • A. conference method
  • B. inference method
  • C. pricing method
  • D. manufacturing method

Explanation

The conference method estimates a cost function through informed opinions and discussion among people familiar with the costs and their drivers. It is judgment-based rather than a purely statistical method.

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About Cost Accounting

Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.

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