Which of the following statements regarding allowances for spoilage and/or inefficiency is not correct?
A) When allowances are not included within the standards, any inefficiencies are highlighted as unfavourable variances.
B) When allowances are not included within the standards, any inefficiencies are highlighted as favourable variances.
C) Firms would never set standards that included an allowance for spoilage.
D) When allowances are not included within the standards, any inefficiencies are highlighted as favourable variances AND firms would never set standards that included an allowance for spoilage.
Correct Answer:
Verified
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