How Many of These Are Considered to Be Benefits of Standard

question 63

Multiple Choice

How many of these are considered to be benefits of standard costing?
It makes employees more aware of the impact of costs on operations
It serves as a target against which to evaluate performance
It is a cheap way of valuing inventory
It eliminates the need to compute variances

• A) One
• B) Two
• C) Three
• D) Four

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Definitions:

Inventory Liquidations

The process of converting a company's inventory into cash, typically at a discount, often used to meet short-term financial needs.

Income Taxes

Taxes imposed by government authorities based on the income earned by individuals and corporations.

Inventory Valuation Errors

Mistakes in calculating the end inventory that can significantly affect a company's cost of goods sold, profits, and tax liabilities.

Income Before Taxes

Income before taxes represents a company's earnings before any income tax expense has been deducted, reflecting the profitability of a company's operations.