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Hospitality Industry Managerial Accounting 8th Edition

Hospitality Industry Managerial Accounting (8th Edition)

Book Edition8th Edition
Author(s)Schmidgall
ISBN9780866124973
PublisherEduc. Inst. Of The American Hotel & Motel Assoc.
SubjectAccounting

Chapter 6, End of Chapter, Review Questions, Exercise 1

Page 327

Here is a tip:

Total costs of service include all costs incurred for rendering a particular service which can be classified as fixed, variable and mixed costs.

Explanation

  •  A cost incurred has been divided into different sections with each one having its own meaning. The cost in case of purchasing a material is a material purchase price, the cost due to some expenses incurred like transportation expenses, etc. are also classified within the meaning of cost. 
  • The cost can also be considered as a loss in cases where the loss arises due to the asset destruction in any accidental event.

Verified Answer

A cost is described as an amount required to produce a product and getting it ready for sale.

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