Differences in Expectation Levels Lead to Two Basic Types of Standards

question 43

Multiple Choice

Differences in expectation levels lead to two basic types of standards in a standard cost system:

• A) Ideal standards and real standards.
• B) Ideal standards and currently attainable standards.
• C) Normal standards and conceptual standards.
• D) Attainable standards and real standards.
• E) Current standards and future standards.

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Definitions:

Profitability

The state or condition of yielding a financial gain or return on investment.

Survival

The ability of an organism, entity, or business to continue to live or exist, especially under difficult or threatening conditions.

Quality Problems

Issues arising from products or services not meeting the established standards of excellence, leading to dissatisfaction or functional failures.

Decentralized

Pertains to the distribution of functions, powers, people, or things away from a central location or authority, often to increase efficiency or responsiveness.