What Results from Implementing Standard Cost Systems in Manufacturing Environments

question 3

Multiple Choice

What results from implementing standard cost systems in manufacturing environments 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.

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Definitions:

Unliquidated Debt

A debt for which the exact value has not been determined, often due to disputes over amount or the presence of damages.

Unilateral Contract

A type of contract where one party makes a promise in exchange for an act by the other party, becoming binding once the act is completed.

Bilateral Contract

A contractual agreement involving two parties where each promises to perform an act in exchange for the other's act.

Past Consideration

Refers to an act or benefit given in the past that cannot be legally considered as an inducement for a contract.