BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Standard costing takes into account the normal capacity of the manufacturing process
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Standard costing records the inventory at standard prices and rates using the actual quantity used.
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Standards used should be regularly reviewed and, if necessary, revised in the light of current conditions.
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Standard costing is a control tool that helps promote cost efficiency
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Detailed explanation-1: -The answer is c) Variances falling outside of an acceptable range of outcomes do not require investigation.
Detailed explanation-2: -Under the Standard Costing System, which of the following actions is true about the cost variance? Explanation: The real cost of material cost, direct labor, and administration to produce a unit of product is known as actual cost. Variance is the difference between the actual and standard costs.
Detailed explanation-3: -A standard costing system does not tell the selling price of a unit to be sold.
Detailed explanation-4: -Question: Which of the following is not a feature of a standard cost system? Answer, d. standards change as conditions change. D is the answer because even though conditions change you don’t necessarily change the standards that were set initially.