How are costs assigned in a standard cost system?
A)actual direct materials, actual direct labour, and budgeted manufacturing overhead
B)actual direct materials, actual direct labour, and actual manufacturing overhead
C)standard direct materials, standard direct labour, and standard manufacturing overhead
D)budgeted direct materials, standard direct labour, and standard manufacturing overhead

Question

Quizplus · Accepted Answer

In a standard cost system, costs are assigned based on standard or predetermined costs for direct materials, direct labour, and manufacturing overhead. Therefore, the correct choice is C which involves using standard direct materials, standard direct labour, and standard manufacturing overhead for assigning costs in a standard cost system. Option A and B involve using actual cost instead of standard cost, while option D involves using budgeted direct materials instead of standard direct materials.

How Are Costs Assigned in a Standard Cost System