A standard cost is a unit cost that _____.
A)should never be revised
B)is the average cost for the industry
C)the company attained in the most recently completed period
D)should be attained

Question

Quizplus · Accepted Answer

A standard cost is the expected unit cost that should be attained under normal conditions. It is used as a benchmark for evaluating actual costs and identifying areas of improvement in the production process. Therefore, option D is the most suitable choice. Option A is incorrect because standard costs may need to be revised periodically based on changes in market conditions or production processes. Option B is incorrect because standard costs are specific to each individual company and may not reflect industry averages. Option C is incorrect because the most recently completed period's cost may not be indicative of future performance or represent the best attainable cost.

A Standard Cost Is a Unit Cost That _____