Which of the Following Is True Regarding Standard Cost Systems

question 153

Multiple Choice

Which of the following is true regarding standard cost systems in manufacturing environments that emphasize continuous improvement and just-in-time manufacturing and purchasing?

• A) The standard cost system enhances the operational control.
• B) The materials price variance may encourage the purchasing department to buy in smaller quantities to reduce inventories.
• C) Variances can be computed and presented in reports to higher-level managers.
• D) The operational level will benefit from the detailed computation of variances.
• E) None of these.

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