Standard Costing

Which of the following is NOT CORRECT about Standard Costing?

• Standard costing is one of the most important tools to control costs

• The difference between the actual costs and pre-determined costs is known as standards

• In Standard costing technique, all the costs are pre-determined in nature and then compared with the actual costs

• Variances are reported to management for taking remedial steps

Which of the following is not an advantage of cost accounting?

• Effective cost control

• Helps in planning

• Increases wastes

• Management by exception

All of the following are the types of current standards EXCEPT

• Expected standards

• Ideal standards

• Flexible standards

• Normal standards

Standards established for an indefinite period of time are called as

• Expected standards

• Basic standards

• Ideal standards

• Normal standards

Standards based on the average performance in the past are known as:

• Ideal standards

• Expected standards

• Basic standards

• Normal standards

Normal standards are also known as:

• Basic Standard

• Ideal Standard

• Past Performance Standard

• Expected Standard

Standards that are based on expected performance after making a reasonable allowance for unavoidable losses and other inevitable lapses from perfect efficiency are:

• Expected Standards

• Basic Standards

• Ideal Standards

• Past Performance Standards

The standard for each of these elements can be divided into:

• Standard profit and Standard production

• Standard loss and Standard quantity

• Standard price and Standard quantity

• Standard input and Standard quantity

Allowances should be made for rest periods, clean-up, machine setup, and machine downtime, while setting:

• Direct Labour Quantity (Hour) Standard

• Direct Material Price Standard

• Direct Materials Quantity Standard

• None of these

The standard that is especially critical in labour-intensive companies is:

• Direct Material Price Standard

• Direct Labour Price(Rate) Standard

• Direct Labour Quantity (Hour) Standard

• Direct Materials Quantity Standard