199k views
0 votes
Standard costs can be used by management to assess the reasonableness of actual costs incurred. Question 1 options:

1 Answer

7 votes

Answer: True

Step-by-step explanation:

Actual costs to be business are impossible to be known with complete certainty before the business embarks on a project yet the business will still need to budget and include costs in that budget. They would need figures for cost for that budget.

This is why Standard costs are important. Being estimates, they will enable a company to be able to assess the reasonableness of actual costs to be incurred and act accordingly.

User Wayne Ye
by
5.0k points