CAF-5 · Chapter 5 · Question 3 of 10
When a business operates with a separate general ledger at the head office and a separate cost ledger at the factory, this system of cost bookkeeping is known as:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) An Interlocking Accounting System
Explanation
A system that maintains separate records (a general ledger at head office for financial accounting and a cost/factory ledger at the factory for management accounting) which are kept in agreement or reconciled is known as an Interlocking Accounting system.
More Cost Flow in Production MCQs
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- Q9When the production of a batch of goods is fully completed on the factory floor, the total cost of these completed units must be…