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Standard costs facilitate management planning. What are theother advantages of standard costs?Standard costs facilitate...

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Accounting

Standard costs facilitate management planning. What are theother advantages of standard costs?

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Standard Costing Overview Standard costing is the practice of substituting an expected cost for an actual cost in the accounting records Subsequently variances are recorded to show the difference between the expected and actual costs This approach represents a simplified alternative to cost layering systems such as the FIFO and LIFO methods where large amounts of historical cost information must be maintained for inventory items held in stockSince standard costs are usually slightly different from actual costs the cost accountant periodically calculates variances that break out differences caused by such factors as labor rate changes and the cost of materials The cost accountant may periodically change the    See Answer
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In: AccountingStandard costs facilitate management planning. What are theother advantages of standard costs?Standard costs facilitate management planning. What are theother advantages of standard costs?

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