30+ Costing Executive Interview Questions and Answers

Unit and bulk quantity costing have different impacts on the overall cost of production.

• Unit quantity costing involves determining the cost of producing one unit of a product, while bulk quantity costing involves determining the cost of producing a large quantity of the same product.

• Unit quantity costing is useful for determining the cost of producing small quantities of a product, while bulk quantity costing is useful for determining the cost of producing large quantities of...read more

Cost, costing, cost accounting, and cost accountancy are related to the process of determining and analyzing the expenses incurred in producing goods or services.

• Cost refers to the amount of money spent on producing goods or services.

• Costing is the process of determining the total cost of production by analyzing various cost components.

• Cost accounting involves recording, classifying, and analyzing costs to help management make informed decisions.

• Cost accountancy is a broader ...read more

Inventory accounting involves tracking and valuing a company's inventory.

• Inventory is recorded as an asset on the balance sheet

• Cost of goods sold (COGS) is recorded as an expense on the income statement

• When inventory is purchased, it is recorded as a debit to the inventory account and a credit to the accounts payable account

• When inventory is sold, the cost of the inventory is transferred from the inventory account to the COGS account

• Periodic inventory system involves taking a...read more

Costing is the process of determining the expenses involved in producing a product or providing a service. A cost accountant analyzes and tracks these costs to help management make informed decisions.

• Costing involves calculating the total expenses incurred in the production process, including direct and indirect costs.

• A cost accountant analyzes cost data to determine the cost per unit of a product or service.

• Cost accountants help in budgeting, pricing decisions, and cost cont...read more

Cost centre is a department or unit that incurs costs, while profit centre is a department or unit that generates revenue and profit.

• Cost centre is responsible for incurring costs in an organization

• Examples of cost centres include HR, IT, and maintenance departments

• Profit centre is responsible for generating revenue and profit

• Examples of profit centres include sales, marketing, and production departments

I have 5 years of costing experience in the footwear industry, specializing in technical shoes.

• Managed costing processes for technical shoe designs, ensuring accurate pricing and cost analysis.

• Collaborated with product development teams to optimize materials and manufacturing processes for cost efficiency.

• Implemented cost-saving initiatives without compromising quality or performance of technical shoes.

• Utilized software tools like Excel and ERP systems to track and analyze co...read more

I have extensive costing experience in Farida Group with a focus on bill of material control.

• Managed and analyzed costs for various products within Farida Group

• Implemented and maintained bill of material control systems to track components and costs

• Collaborated with cross-functional teams to ensure accurate costing and pricing

• Identified cost-saving opportunities through analysis of bill of materials

• Ensured compliance with costing policies and procedures

Costing in pharmaceutical companies involves analyzing the cost of production, distribution, and marketing of drugs.

• Costing involves calculating the cost of raw materials, labor, equipment, and overhead expenses for producing pharmaceutical products.

• Pharmaceutical companies also consider research and development costs, regulatory compliance expenses, and marketing costs in their costing analysis.

• Costing may also involve pricing strategies to ensure profitability while remaini...read more

Cost accounting standards are guidelines for measuring, assigning, and allocating costs in a consistent manner.

• Cost Accounting Standard 401: Determination of Reasonableness of Costs - Ensures that costs are reasonable and allocable to the contract.

• Cost Accounting Standard 402: Consistency in Allocating Costs Incurred for the Same Purpose - Requires consistent allocation of costs for the same purpose.

Pharma costing process involves determining the cost of producing and distributing pharmaceutical products.

• Pharma costing process includes calculating the cost of raw materials, labor, equipment, and overhead expenses.

• It also involves determining the cost of research and development, clinical trials, and regulatory compliance.

• Pharma companies use various costing methods such as standard costing, activity-based costing, and marginal costing.

• Costing analysis helps pharma compan...read more

Budgetary control is a process of setting budgets, comparing actual performance against the budgets, and taking corrective actions to achieve financial goals.

• Setting budgets for different departments or projects

• Monitoring actual performance against the budgets

• Analyzing variances and taking corrective actions

• Helps in achieving financial goals and improving efficiency

• Example: A company sets a budget for marketing expenses and regularly compares actual spending to the budget to ...read more

Variance analysis is a technique used to compare actual costs to budgeted costs in order to identify differences and analyze the reasons behind them.

• Variance analysis helps in understanding the reasons for deviations from the budgeted costs.

• It involves comparing actual costs with standard or budgeted costs to determine the differences.

• Variances can be favorable (costs lower than expected) or unfavorable (costs higher than expected).

• By analyzing variances, companies can take c...read more

Various types of materials are used in costing with different rates.

• Materials can be categorized as direct and indirect

• Direct materials include raw materials, components, and sub-assemblies

• Indirect materials include consumables, office supplies, and maintenance supplies

• Current rates depend on market conditions and availability

• Example: Steel - $800/ton, Copper - $6.50/lb, Plastic - $0.50/lb

Inventory valuation is the process of assigning a monetary value to the items held in a company's inventory.

• Inventory valuation helps in determining the cost of goods sold and the value of ending inventory on the balance sheet.

• Common methods of inventory valuation include FIFO (First-In-First-Out), LIFO (Last-In-First-Out), and weighted average cost.

• The choice of inventory valuation method can impact a company's profitability and tax liabilities.

• Accurate inventory valuation i...read more

Overheads are indirect costs incurred by a business in its operations, not directly attributable to a specific product or service.

• Overheads include expenses like rent, utilities, salaries of support staff, and office supplies.

• These costs are necessary for the business to function but cannot be directly traced to a specific product or service.

• Overheads are typically allocated to products or services based on predetermined allocation methods.

• Examples of overhead costs include a...read more

Development costs should be capitalized if they meet certain criteria.

• Development costs can be capitalized if they are directly related to the creation of a new product or process.

• If the costs are related to improving an existing product or process, they should be expensed.

• Capitalized development costs are amortized over the useful life of the product or process.

• If the product or process is abandoned, the capitalized costs must be written off immediately.

Costing is the process of determining the expenses associated with a particular project or business operation.

• Costing involves analyzing all the expenses incurred in producing a product or providing a service.

• It helps in determining the cost per unit of a product or service.

• Costing includes direct costs (e.g. materials, labor) and indirect costs (e.g. overhead expenses).

• Different costing methods can be used such as job costing, process costing, and activity-based costing.

• Cost...read more

SCA 104 is a standard costing method used in manufacturing industries to determine the cost of products.

• SCA 104 stands for Standard Cost Accounting 104.

• It involves setting predetermined costs for direct materials, direct labor, and overhead.

• Variances are calculated by comparing actual costs to standard costs.

• Helps in cost control and decision-making.

• Example: If the standard cost for a product is $10 for direct materials and actual cost is $12, there is a $2 unfavorable varian...read more

Cost sheet includes direct and indirect costs incurred in production.

• Includes direct materials, direct labor, and manufacturing overhead costs

• Indirect costs like factory rent, utilities, and depreciation are also included

• Helps in determining total production cost and setting selling prices

Recent updates on GST include changes in tax rates, new compliance requirements, and updates on input tax credit rules.

• GST rates have been revised for various goods and services.

• New compliance requirements such as e-invoicing and QR code on invoices have been introduced.

• Updates on input tax credit rules to prevent fraudulent claims.

• Changes in GST return filing deadlines and procedures.

No location constraint

My daily work flow involves analyzing costs, creating budgets, and collaborating with other departments.

• Reviewing and analyzing financial data

• Creating and managing budgets

• Collaborating with other departments to ensure cost efficiency

• Preparing reports and presentations for management

• Attending meetings and providing financial insights

• Staying up-to-date with industry trends and regulations

Cost process in manufacturing industry involves calculating the expenses incurred in producing goods or services.

• Cost process includes identifying direct and indirect costs associated with production.

• Calculating the cost of raw materials, labor, overhead, and other expenses.

• Analyzing cost variances to improve efficiency and reduce expenses.

• Implementing cost control measures to optimize production costs.

• Example: Cost process in manufacturing industry may involve calculating th...read more

Standard cost is a predetermined cost calculated based on a variety of factors to estimate the cost of producing a product or providing a service.

• Standard cost includes direct materials, direct labor, and overhead costs.

• It is used for budgeting, cost control, and decision-making purposes.

• Standard cost is compared to actual costs to analyze variances and improve cost efficiency.

• For example, if a company estimates that it will cost $10 in materials and $5 in labor to produce a ...read more

Direct expenses are directly related to production, while indirect expenses are not directly tied to production.

• Direct expenses can be easily traced to a specific cost object, such as raw materials or labor costs.

• Indirect expenses are not easily traceable to a specific cost object and are typically allocated based on a predetermined allocation method.

• Examples of direct expenses include direct materials, direct labor, and manufacturing supplies.

• Examples of indirect expenses in...read more

Qualifications for a Costing Executive typically include a degree in accounting or finance, strong analytical skills, experience with cost analysis, and proficiency in financial software.

• Degree in accounting or finance

• Strong analytical skills

• Experience with cost analysis

• Proficiency in financial software

Costing method refers to the process of determining the expenses associated with a particular product or service.

• Costing methods include job costing, process costing, activity-based costing, and absorption costing.

• Job costing is used for unique products or services, while process costing is used for standardized products.

• Activity-based costing assigns costs based on the activities that drive them.

• Absorption costing includes all manufacturing costs in the cost of a product.

• Cos...read more

Types of budgets include master budget, operating budget, financial budget, and static budget.

• Master budget: comprehensive overview of all financial activities for a specific period

• Operating budget: focuses on revenues and expenses related to the core operations of the business

• Financial budget: projects cash flows, capital expenditures, and financing activities

• Static budget: fixed budget based on a single level of activity

Costing method and concepts refer to the techniques and principles used to determine the cost of products or services.

• Costing methods include job costing, process costing, and activity-based costing.

• Costing concepts include direct costs, indirect costs, fixed costs, variable costs, and overhead costs.

• Understanding costing methods and concepts helps in accurate cost estimation, pricing decisions, and profitability analysis.