A purpose of standard costing is to
A)replace budgets and budgeting.
B)simplify costing procedures.
C)eliminate the need for actual costing for external reporting purposes.
D)eliminate the need to account for year-end underapplied or overapplied manufacturing overheaD.

Question

Quizplus · Accepted Answer

The purpose of standard costing is to simplify costing procedures by determining predetermined costs for direct materials, direct labor, and manufacturing overhead. It is not meant to replace budgets or actual costing for external reporting purposes, nor does it eliminate the need to account for year-end underapplied or overapplied manufacturing overhead.

A Purpose of Standard Costing Is to