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State Direct material cost standard
The determination of direct material cost standard would involve:
a) Determination of quantity standards and
b) Determination of price standards
For determination material quantity standards for each material going as an input in the product, it is necessary to develop a product design and material specification as an input in a scientific manner on the basis of experiments/test runs. These specifications must be adhered to except in special circumstances when a revision is to be effected. If any should also be seceded on the basis of past experience or scientific analysis.
Moore Company uses process costing. The following information was available for October: During October, 1,000 units were started, and costs incurred during the month were
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Disadvantages of ratio analysis 1) False results: ratios are based upon the financial statement. In case financial ratio is incorrect or the data upon which ratios are based
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