PART: I SAY True Or False
1. Cost accounting is used only by manufacturing firms.
2. Fixed costs remain constant per unit regardless of production volume.
3. Job order costing is suitable when products are customized.
4. Standard costing uses pre-determined costs for cost control.
5. Sunk costs are relevant for future decision-making.
6. Direct materials are part of prime costs.
7. Variable costs increase in total as production increases.
8. Overhead costs are always direct costs.
9. Data extraction refers to collecting data from various sources.
10. ETL stands for Extract, Translate, and Load.
Answer (2)
Let's analyze each statement one by one to determine if they are true or false:
Cost accounting is used only by manufacturing firms. False. Cost accounting is used by various types of organizations, not just manufacturing firms. It helps businesses manage costs and improve efficiency in both service and manufacturing settings.
Fixed costs remain constant per unit regardless of production volume. False. Fixed costs remain constant in total, not per unit. As production volume increases, fixed costs per unit actually decrease.
Job order costing is suitable when products are customized. True. Job order costing is designed for situations where products are made based on specific customer orders and each job has different production requirements.
Standard costing uses pre-determined costs for cost control. True. Standard costing involves using pre-determined costs for materials, labor, and overhead, which helps in controlling costs and evaluating performance.
Sunk costs are relevant for future decision-making. False. Sunk costs are past costs that have already been incurred and cannot be recovered; hence, they are not considered in future decision-making.
Direct materials are part of prime costs. True. Prime costs consist of direct materials and direct labor, which are directly attributable to the production process.
Variable costs increase in total as production increases. True. Variable costs change in total in direct proportion to changes in production volume or activity level.
Overhead costs are always direct costs. False. Overhead costs are usually indirect costs that cannot be directly traced to a specific product, such as rent, utilities, and administrative salaries.
Data extraction refers to collecting data from various sources. True. Data extraction involves obtaining data from various sources to be processed or analyzed further.
ETL stands for Extract, Translate, and Load. False. ETL stands for Extract, Transform, and Load, which refers to a process used in data warehousing to extract data from sources, transform it into a suitable format, and load it into a final data store.
Out of the ten statements analyzed, seven are identified as true and three as false based on their definitions in cost accounting and data management practices. Each statement was reviewed to clarify the concepts surrounding cost accounting, fixed and variable costs, and data extraction processes. This assessment provides a foundational understanding for students studying business and finance concepts.
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