The number of purchase orders for each year is multiplied to relevant ordering cost for each purchase order to calculate _____________?
Correct answer: C. annual relevant ordering costs
- A. annual irrelevant ordering costs
- B. annual relevant carrying costs
- C. annual relevant ordering costs
- D. annual irrelevant carrying costsCompare Credit Cards
Explanation
Annual relevant ordering cost is calculated by multiplying the number of orders placed during the year by the relevant cost per order. Carrying costs instead depend on the inventory held.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
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.
Practise Cost Accounting
941 free Cost Accounting MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Cost Accounting questions
If the relevant incremental costs are $5000 and the relevant opportunity cost of invested capital is $2500, then the relevant inventory carrying costs would be ____________?
The profit forgone by capital investment in inventory rather than investment of capital to somewhere else is classified as ____________?
The costs of goods acquired from suppliers are classified as ___________?
The method of costing that supports creation of value for customer by accounting whole value stream, rather than individual departments or products is classified as __________?
If the purchase order lead time is 35 minutes and number of units sold per time is 400 units, then reorder point will be ____________?
The costs of issuing purchase orders, making of delivery records for tracking payments and costs of inspection of items are classified as _____________?