CMA Intermediate · Cost Accounting · Batch Costing
Which of the following is a feature that distinguishes batch costing from job costing?
The distinguishing feature is that total batch cost is divided by the number of units in the batch to get cost per unit. Opening cost sheets, using order numbers and tracing direct costs are common to job costing too, so they do not separate the two methods.
- AA separate cost sheet is opened for each work order
- BCosts are accumulated against a production order number
- CCost per unit is found by dividing total batch cost by the number of units in the batchCorrect
- DDirect material and direct labour are traced to the cost unit
Explanation
Cost sheets, order numbers and direct tracing are common to both job and batch costing. What is specific to batch costing is that the batch contains many similar units, so the total batch cost is averaged over the units produced to find unit cost.
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