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A standard costing system

		is used by management for cost planning, but not for cost control purposes.
		is a system in which all costs affecting the three inventory accounts and the Cost of Goods Sold account are stated in terms of actual costs incurred.
		depends on actual costs rather than planned costs.
		is employed with an existing job order costing or process costing system and is not a full cost accounting system in itself Standard costs for company products are typically used for all except variance analysis and cost control. computing production costs in operating budgets. determining the actual cost of direct materials and direct labor used in production. comparing the production costs for performance measurement purposes. An expression of the hourly labor pay cost per function or job classification that is expected to exist during the next accounting period is the definition of a direct labor time standard. direct materials quantity standard. direct labor rate standard. variable overhead rate. Blue Bull Inc. uses direct labor hours to allocate variable and fixed overhead costs. Under which of the following circumstances would the base used to calculate the variable overhead rate be the same as that used for the fixed overhead rate? When actual labor hours are the same as budgeted labor hours When standard indirect labor hours agree with standard direct labor hours In all circumstances the base used for each calculation is the same When the number of labor hours expected to be incurred for the period is the same as normal capacity direct labor hours Gunnie Inc. produces and sells dog food. Each bag contains 20 pounds of dog food. Following additional information is provided by the company: Direct materials quantity standard 20 pounds per unit Direct materials price standard $0.02 per pound Direct labor time standard 0.1 hour per unit Direct labor rate standard $11.50 per hour Variable overhead rate standard $2.50 per machine hour Fixed overhead rate standard $1.50 per machine hour Machine hour standard 0.25 hours per unit Compute the standard unit cost for each bag. $2.55 $2.21 $2.15 $2.80

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