Absorption means ________.
A. charging overheads to cost centres
B. charging of overheads to cost units
C. charging of overheads to cost centres or cost units
D. allotment of overheads to different departments
Answer: Option B
Solution(By Examveda Team)
Absorption means charging of overheads to cost units. It means costs is absorbed by the production (or product units )during the period or charging each unit of a product with an equitable share of overhead expenses.Related Questions on Costing
Basic objective of cost accounting is ________
A. tax compliance.
B. financial audit.
C. cost ascertainment.
D. profit analysis.
Process costing is suitable for ________.
A. hospitals
B. oil refing firms
C. transport firms
D. brick laying firms
The cost which is to be incurred even when a business unit is closed is a _____.
A. imputed cost
B. historical cost
C. sunk cost
D. shutdown cost
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