Costing questions are usually lost in the setup rather than the calculation. These are the errors that appear again and again in student scripts.
1. Confusing allocation, apportionment and absorption
Allocation assigns a whole cost to one department. Apportionment splits a shared cost on a logical basis. Absorption charges overhead to the product. Mixing these up derails the whole answer.
2. Wrong cost sheet format
Prime cost, works cost, cost of production, cost of sales — the sequence is fixed. Learn the skeleton before attempting any question.
3. Equivalent production shortcuts
Opening and closing work-in-progress need separate treatment for each cost element. Rushing this statement is the most common process costing error.
4. Variance signs
Decide favourable or adverse from the meaning, not the sign of your arithmetic. State it explicitly with every variance.
5. Skipping the units
Per-unit and total figures get mixed constantly. Write the unit next to every number you compute.
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