Ch. 9 Standard Costs Flashcard

Front

What are standard costs based on?

Back

Carefully predetermined amounts

Front

What is one of the purposes of standard costs?

Back

To serve as benchmarks for measuring performance

Front

How are standard costs used in planning?

Back

For planning labor, material, and overhead requirements

Front

What do standard costs represent in terms of performance?

Back

The expected level of performance

Front

What do ideal standards represent?

Back

Optimum levels of performance under perfect conditions.

Front

What do normal standards represent?

Back

Efficient levels of performance expected under regular conditions.

Front

How should properly set normal standards be described?

Back

Rigorous but attainable.

Front

What is a quantity standard?

Back

The amount of input that should be used in each unit of product or service

Front

Which of the following is an example of a price standard? Number of ounces of aluminum in a Coca Cola can, Price per ounce of aluminum, Number of tons of steel in a Ford F-150 truck, Number of yards of denim in a pair of Levi's 550 jeans

Back

Price per ounce of aluminum

Front

What does a price standard specify?

Back

The price that should be paid for a specific quantity of input