How do managers and companies set price and quantity standards?
A)Based on a manager's previous experience at another company.
B)Based on historical data,industry averages,and the results of process studies.
C)Based on the ideal budget created for the operating division.
D)Based on prior period variances.

Question

Quizplus · Accepted Answer

Managers and companies typically set price and quantity standards based on historical data, industry averages, and the results of process studies. This allows them to make informed decisions about pricing and production levels that are based on real-world data and analysis rather than simply relying on past experience or ideal budgets. Prior period variances can be taken into account when setting these standards, but they should not be the sole factor considered.

How Do Managers and Companies Set Price and Quantity Standards