The product which requires large amount of resources, but incur low per unit cost is classified as __________?
Correct answer: A. product under costing
- A. product under costing
- B. product over costing
- C. expected under cost
- D. expected over cost
Explanation
A product is undercosted when it consumes relatively large amounts of resources but is assigned too little cost per unit. Overcosting is the reverse situation, where too much cost is assigned to a product.
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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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