When distribution costs are high, managers can use standard costing to analyze variances for spending and efficiency variances.

Question

Quizplus · Accepted Answer

Standard costing is a valuable tool for analyzing variances related to spending and efficiency in order to control costs. This can be particularly useful when distribution costs are high, as it allows managers to identify the reasons behind the increased costs and take corrective action to improve efficiency and reduce expenses.

When Distribution Costs Are High, Managers Can Use Standard Costing