Asked by Danielle Tabor on Jul 22, 2024
Verified
Standard costs should always be revised when they differ from actual costs.
Standard Costs
Predetermined costs to manufacture a product, serving as a benchmark for assessing actual production costs.
Actual Costs
The real expenses incurred for materials, labor, and overhead in the production of goods or services, as opposed to estimated or budgeted costs.
- Comprehend the importance and method involved in adjusting standard costs.
Verified Answer
EA
Emmanuel AniemekeJul 28, 2024
Final Answer :
False
Explanation :
Standard costs are predetermined or budgeted costs that serve as a benchmark for evaluating performance. They are not revised every time they differ from actual costs because variances can provide valuable information for management about areas of efficiency or inefficiency, and frequent revisions could obscure these insights.
Learning Objectives
- Comprehend the importance and method involved in adjusting standard costs.