Which of the following is not a reason standard costs are separated in two components?
A) the price and quantity variances need to be identified separately to correct the actual major differences.
B) identifying variances determines which manager must find a solution to major discrepancies.
C) if a negative variance is over-shadowed by a favorable variance, managers may overlook potential corrections.
D) variances brings attention to discrepancies in the budget and requires managers to revise budgets closer to actual.

Question

Quizplus · Accepted Answer

Standard costs are separated into price and quantity variances to identify specific areas of discrepancy and assign responsibility, not primarily to revise budgets.

Which of the Following Is Not a Reason Standard Costs