The costing technique, which traces direct costs by multiplying price rate for producing actual outputs is known as ______________?
Correct answer: D. standard costing
- A. constant costing
- B. batch costingGet Executive Coaching
- C. unit costing
- D. standard costing
Explanation
Standard costing applies predetermined standard price or rate and quantity amounts to actual output, allowing actual results to be compared with standards through variances. Unit and batch costing describe the unit of cost accumulation rather than this standard-versus-actual technique.
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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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