Question

Standard costing offers benefits in several areas. In which of the following areas might standard costing prove to be an advantage or a disadvantage?

	A.	management by exception
	B.	responsibility accounting
	C.	budgeting
	D.	bookkeeping

Answer 1

Standard Costing is management accounting techniques in which management will know his budgeted expenses or income V/s actual expenses or actual income in form of Favorable and Unfavourable and favorable.

Standing costing will identifies who are the responsible for what, So this is used for fix the responsibility of each and everyone.

But standard costing will have no impact on budgeting and bookkeeping

So Answer =

A = Management by Exception = Advantage

B = Responsibilities Accounting = Advantage

C = Budgeting = Disadvantage

D = Bookkeeping = Disadvantage