The primary purpose of calculating standard cost variances each period is:
A) To achieve financial control regarding operating activities.
B) To facilitate the recording of manufacturing costs during a period.
C) To adjust reported income to flexible-budget income.
D) To diagnose the cause of operating problems as well as what should be done to correct such problems.
E) To minimize income tax liabilities.

Question

Quizplus · Accepted Answer

Standard cost variances are calculated to achieve financial control by comparing actual costs to standard costs, helping identify areas where performance deviates from expectations.

The Primary Purpose of Calculating Standard Cost Variances Each Period