COST ACCOUNTING
STANDARD COSTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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In developing a standard cost for direct materials, a price factor and a quantity factor must be considered.
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True
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False
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Explanation:
Detailed explanation-1: -Answer and Explanation: Option (D) is the correct answer. Standard cost is used as the tool for measuring efficiency for controlling the cost of production. Standard cost is part of the cost accounting process.
Detailed explanation-2: -Standard costs are estimates of the cost of goods sold–that is, the cost required to produce your products. They usually consist of three parts: direct materials, direct labor, and manufacturing overhead.
Detailed explanation-3: -Answer and Explanation: The price variance can occur concerning material prices or labor costs.
There is 1 question to complete.