If a company uses large quantity of input than the budgeted quantity for output level, then the company is known to be __________?
Correct answer: D. company is inefficient
- A. variable growth of company
- B. constant growth of company
- C. company is efficient
- D. company is inefficient
Explanation
Using more input than the budget allows for the achieved output indicates inefficient resource use. Efficiency means producing the output with no more than the standard input quantity.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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