{"id":59115,"date":"2024-04-16T01:31:26","date_gmt":"2024-04-16T01:31:26","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=59115"},"modified":"2024-04-16T01:31:26","modified_gmt":"2024-04-16T01:31:26","slug":"from-the-following-two-statements-of-assertion-a-and-reason-r-indicate-the-correct-answer-assertion-a-from-the-marginal-costing-approach-point-of-view-the-marginal-cost-is-compared-with-the-p","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/from-the-following-two-statements-of-assertion-a-and-reason-r-indicate-the-correct-answer-assertion-a-from-the-marginal-costing-approach-point-of-view-the-marginal-cost-is-compared-with-the-p\/","title":{"rendered":"From the following two statements of Assertion (A) and Reason (R), indicate the correct answer. Assertion (A) From the marginal costing approach point of view, the marginal cost is compared with the purchase price. Reason (R) If the marginal cost is less than the purchase price it should be purchased rather than manufactured."},"content":{"rendered":"

[amp_mcq option1=”Both (A) and (R) are correct” option2=”(A) is correct, but (R) is not correct” option3=”(A) is not correct, but (R) is correct” option4=”Both (A) and (R) are incorrect” correct=”option1″]<\/p>\n

The correct answer is: A. Both (A) and (R) are correct<\/strong><\/p>\n

Marginal costing is a cost accounting technique that focuses on the costs that vary with the production volume. The marginal cost of a product is the additional cost incurred to produce one more unit of the product. The purchase price is the price that a company pays to purchase a product from another company.<\/p>\n

If the marginal cost of a product is less than the purchase price, then the company should purchase the product rather than manufacture it. This is because the company will save money by purchasing the product rather than manufacturing it.<\/p>\n

The following is a brief explanation of each option:<\/p>\n