Standard costs
A)are estimates of costs attainable only under the most ideal conditions.
B)are difficult to use with a process costing system.
C)can,if properly used,help motivate employees.
D)require that significant unfavorable variances be investigated,but do not require that significant favorable variances be investigateD.

Question

Quizplus · Accepted Answer

Standard costs, when properly used, can help motivate employees by setting expectations of what should be achieved and encouraging employees to work towards meeting or exceeding those expectations. A is incorrect because standard costs are achievable under normal operating conditions, not just ideal conditions. B is incorrect because standard costs can be used with either a process costing or a job costing system. D is incorrect because significant favorable variances should also be investigated to identify best practices and opportunities for improvement.

Standard Costs