Costing

43. Assertion (A) Break-even point can be determined both mathematically as well as graphically. Reason (R) When it is determined on a graph paper, the graph drawn is named as ‘break-even chart’.

(A) is true, but (R) is false
(A) is false, but (R) is true
Both (A) and (R) are true and (R) is the correct explanation of (A)
Both (A) and (R) are true, but (R) is not the correct explanation of (A)

Detailed SolutionAssertion (A) Break-even point can be determined both mathematically as well as graphically. Reason (R) When it is determined on a graph paper, the graph drawn is named as ‘break-even chart’.

50. Statement (A): It is necessary to tally current costs with current income in order to find out the correct profit. Reason (R): LIFO ensures matching of current costs with current income.

Both A and R are correct and R is the correct explanation of A
Both A and R are correct but R is not the correct explanation of A
A is correct but R is incorrect
A is incorrect but R is correct

Detailed SolutionStatement (A): It is necessary to tally current costs with current income in order to find out the correct profit. Reason (R): LIFO ensures matching of current costs with current income.

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