Costing Methods in Estimation And Costing : Practice MCQ Questions & Answers with Explanations

The correct answer is A: Homogeneous products.

Under batch costing, homogeneous products are taken as the cost unit. A batch consists of a specific number of identical units processed simultaneously. Inputs accumulate in the assembly line until the minimum batch size is reached, after which all inputs in the batch are processed for further operations.

The correct answer is D: Both 1 & 3.

The basic object of all costing is to analyse and ascertain the cost of each unit of production, and to control and regulate cost. These principles are valid for all types of industry including printing, furniture, ship-building, and heavy machinery. Determining profitability is also an objective, but options 1 and 3 directly represent the principal purposes.