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8 marksService Sector Costing

CAPE Accounting Unit 2 · 2015 · Paper 2 · Question 2(d)

A service such as a hairdo or haircut is perishable, intangible, heterogeneous, and produced and consumed simultaneously.

Explain the difficulties with costing a hairdo/haircut because of these four features.

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Other parts of this question

  1. 2(a)Calculate the total cost of EACH job assuming overhead is applied at the rate of $12.50 per machine hour.[10 marks]
  2. 2(b)(i)Calculate the activity rate for EACH activity.[7 marks]
  3. 2(b)(ii)State TWO benefits of activity-based costing.[2 marks]
  4. 2(c)Copy the list and identify the units of cost that should be applied for each item on the job cost card for services delivered.[8 marks]

More practice: the rest of this paper · more Service Sector Costing questions · all CAPE Accounting Unit 2 past papers