Standard Costs Are Able to Be Used Under AASB 102

question 18

Multiple Choice

Standard costs are able to be used under AASB 102 where:

• A) they have been properly set and maintained.
• B) they are realistically attainable and are reviewed regularly.
• C) they are assessed to be a sound basis for the purpose of inventory valuation.
• D) they are revised in the light of current conditions as necessary.

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Definitions:

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, reflecting the true profitability of a business.

TR

Total revenue, representing the total sales income a firm receives from selling its goods or services.

TC

An abbreviation commonly used for Total Cost, which encompasses all costs incurred in the production of goods or services.

Scale Of Operation

Refers to the size at which a particular business or factory operates, considering factors like output, capacity, or the amount of work it can perform.