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Q. The over-absorbed overhead is accounted for as an adjustment to the profit in the period, and is added to profit in the cost accounting income statement.

Q. Since a by-product does not have any substantial value, there is no sense in charging it with a share of the common processing costs.

Q. If normal loss has a scrap value the company is able to recover some of the input costs to the process. The scrap value reduces the cost of the process.

Q. An equivalent unit means ‘equal to one finished unit of output’.

Q. Cost of defective materials should be……………………to costing P/L account and……………….to contract account.

Q. In Units basis, Common costs are apportioned between joint products on the basis of the total number of units produced. The cost per unit is the same for all the joint products. (This is also described as the physical quantities basis).

Q. If the amount of production overheads absorbed into product costs is more than the actual production overhead expenditure, there is:

Q. Escalation Clause aims at safeguarding the interest of the ……………….against unforeseen rise in cost.

Q. An overhead absorption rate is used to:

Q. When actual loss is less than the expected (normal) loss there is: