Total transferred-out cost plus normal spoilage is divided by number of goods units produced, to calculate ___________?
Correct answer: B. cost per good units transferred out
- A. cost per good units transferred in
- B. cost per good units transferred out
- C. revenue per good units transferred out
- D. revenue per good units transferred in
Explanation
Adding the cost of normal spoilage to transferred-out cost spreads the production cost over the good units produced. This gives the cost per good unit transferred out, not revenue or transferred-in cost.
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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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