13.2 Budgeting and Standard Costs

Question 1

Predetermined expectations about how much a unit of input, a unit of output, or a given activity should cost

Answer 1

standard costs

Question 2

Standard costs that are set for production under optimal conditions. They are based on the work of the most skilled workers, with no allowance for waste, spoilage, machine breakdowns, or other downtime.

Answer 2

Ideal (theoretical) standards

Question 3

Performance that is expected to be achieved by reasonably well-trained workers with an allowance for normal spoilage, waste, and downtime.

Answer 3

Practical (currently attainable) standards