Question

State whether the statement is True or False:
‘Operating costing is concerned with the ascertainment of operating cost for manufactured tangible product.’

Hint:

Operating costing = service industry costing, not manufacturing.

Answer 1

Operating costing is a method for determining the expense of providing services, distinct from costing tangible manufactured goods.
This method is employed by entities such as transportation firms, healthcare facilities, hospitality establishments, and utility providers.
The primary objective is to establish the cost associated with each unit of service rendered, for instance, cost per kilometer, cost per patient day, or cost per room night.
Costing for manufactured tangible products utilizes alternative methodologies like job costing, batch costing, or process costing, not operating costing.
Consequently, the provided assertion is False.