A Good System of Standard Costing Always

question 66

Multiple Choice

A good system of standard costing always

• A)ensures that the right staff are to blame if there are negative variances.
• B)ensures that the right staff are both rewarded and blamed when there are positive or negative variances.
• C)avoids excessive detail in examining small variances.
• D)considers the impact of morale on all those who utilize the reporting system.

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Definitions:

Accounts Receivable

The sum of money a company is entitled to receive from its customers for goods or services already delivered or used but not yet paid for.

Inventory

Inventory is the array of finished goods or goods used in production held by a company during its ordinary course of business.

Firm's Value

Firm's Value represents the total worth of a company, measured by factors such as market capitalization, revenue, profits, and its assets minus liabilities.

Accounting Profit

The net income for a company as calculated according to generally accepted accounting principles (GAAP), taking into account only explicit costs.