Concept explainers
(Learning Objective 1) Which of the following is true?
- a. Ideal standards are based on currently attainable conditions.
- b. Practical standards are based on ideal conditions.
- c. A
standard cost is the budgeted cost for one unit. - d. Standards should never be updated.
To identify: The appropriate answer for the given statement.
Answer to Problem 1QC
Option c. The true statement is a standard cost is the budgeted cost for one unit.
Explanation of Solution
a.
Ideal standards are based on currently attainable conditions is not the correct option because Ideal standards are the standards which are based on ideal conditions.
b.
Practical standards are based on ideal conditions is not the correct option because Practical standards are based on currently attainable conditions.
c.
A standard cost is the budgeted cost for one unit is the correct option because standard cost is the budgeted cost for a unit.
d.
Standards should never be updated is not the correct option because standard once developed needs to be kept updated.
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Chapter 11 Solutions
Managerial Accounting (5th Edition)
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