Costing

Question 1

fixed capital and working capital are both

Answer 1

Capital Costs

Question 2

Define Operating cost

Answer 2

Cost of Manufacture or Cost of Goods

Question 3

Capital cost adjustment - scale up/down equation

Answer 3

𝐶𝑜𝑠𝑡2 = 𝐶𝑜𝑠𝑡1 (size2/𝑆𝑖𝑧𝑒 1)^0.6

Question 4

Define Inflation

Answer 4

Money losing its value

Question 5

Inflation equation

Answer 5

𝐶𝑜𝑠𝑡 𝑖𝑛 𝑦𝑒𝑎𝑟 𝐴 = 𝐶𝑜𝑠𝑡 𝑖𝑛 𝑦𝑒𝑎𝑟 𝐵 × (𝐶𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛𝑦𝑒𝑎𝑟 𝐴 /𝐶𝑜𝑠𝑡 𝑖𝑛𝑑𝑒𝑥 𝑖𝑛 𝑦𝑒𝑎𝑟 B)

Question 6

Revenue

Answer 6

total income, does not included expenses

Question 7

Estimation of cost includes

Answer 7

manufacturing cost and general expenses.

Question 8

Define Direct production costs (variable costs)

Answer 8

directly associated with production and vary according to production rate

Question 9

Define Indirect costs (fixed costs)

Answer 9

they are not dependent upon rate

Question 10

Define Overhead costs

Answer 10

they are associated with the running of the facility

Question 11

Examples of variable cost

Answer 11

raw materials, operating labour, utilities, maintenance and repair,

Question 12

Taxes, rent, insurance, are examples of

Answer 12

fixed cost