Standard Costs

question 41

Multiple Choice

Standard costs:

• A) allow a manager to assess the efficiency of operations.
• B) allow a company to practice management by exception.
• C) provide management with a basis for performance evaluations.
• D) if set correctly, can provide a motivational tool for employees.
• E) All of the answers are correct.

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Definitions:

Purchaser

An individual or entity that buys goods or services for personal use, resale, or further production.

Seller

An individual, company, or entity that offers goods or services for sale.

Government Policy

The set of laws, regulations, actions, and decisions made by a government to advance its goals.

Potentially Efficient

A condition or situation in which resources could be utilized in a way that maximizes productivity or benefit, but are not currently being used to their full potential.