Describe Several Factors That Should Be Considered in Establishing Standards

question 13

Essay

Describe several factors that should be considered in establishing standards for use with a standard costing system.

---

Definitions:

Infrastructure

The basic physical and organizational structures and facilities needed for the operation of a society or enterprise, such as roads, buildings, and power supplies.

CVP

Stands for Cost-Volume-Profit analysis, a financial tool that companies use to determine how changes in costs and volume affect a company's operating income and net income.

Customer Relationships

The ongoing process of engaging with customers to foster loyalty, satisfaction, and mutual benefit through direct and indirect communication and service.

Business Models

Schematic representations of how a company creates, delivers, and captures value for itself and its customers.