In standard costing,
A)the standards are developed only for overhead costs.
B)the standards are developed primarily from past costs.
C)comparisons with actual costs usually are not performed.
D)debit and credit entries to inventory accounts are made at standard costs.

Question

Quizplus · Accepted Answer

In standard costing, debit and credit entries to inventory accounts are made at standard costs, which is the predetermined cost for materials, labor, and overhead. Standards are not developed only for overhead costs but for all cost components. Standards are developed from past costs but are adjusted for changes in the business environment or production processes. Comparisons with actual costs are performed to identify variances and take corrective actions.

In Standard Costing