Classify the following items on the basis of cost: [Oct. – 07]
(a) On the basis of functions:
(i) Trade fair expenses
(ii) Lawyers Fees
(iii) Fuel and Oil
(iv) Market Research Expenses
(b) On the basis of traceability to the product:
(i) Customs duty on purchases
(ii) Bank charges
(iii) Carriage expenses on Raw materials
(iv) Secondary Packaging material
(c) On the basis of relation to change in level of activity:
(i) Telephone charges of Rs. 1,500
(ii) Factory Insurance
(iii) Depreciation of plant
(iv) Cost of raw materials
Soln:
(a) (i) Selling and Distribution Cost
(ii) Office and Administration Cost
(iii) Works/ Factory Cost
(iv) Selling and Distribution Cost
(b) (i) Direct Cost
(ii) Indirect Cost
(iii) Direct Cost
(iv) Indirect Cost
(c) (i) Semi-Fixed Cost
(ii) Fixed Cost
(iii) Fixed Cost
(iv) Variable Cost
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