Standard costs are based on estimates of cost of materials, labour and overheads. Standard costs are also known as
A) actual costs.
B) forecasted costs.
C) expected costs.
D) budgeted costs.

Question

Quizplus · Accepted Answer

Standard costs are often used as a basis for preparing a budget, and thus are also known as budgeted costs. They are not the same as actual costs, which reflect the real costs incurred during a given period. Forecasted costs and expected costs are similar concepts, but they do not necessarily relate specifically to standard costs.

Standard Costs Are Based on Estimates of Cost of Materials