The primary purpose of calculating standard cost variances each period is:
A)To achieve financial control regarding operating activities.
B)To facilitate the recording of manufacturing costs during a period.
C)To adjust reported income to flexible-budget income.
D)To diagnose the problems of operating problems as well as what should be done to correct such problems.

Question

Quizplus · Accepted Answer

The primary purpose of calculating standard cost variances each period is to achieve financial control regarding operating activities. Standard cost variances help the management in monitoring and controlling the manufacturing costs, which ultimately leads to better financial control over the company's operating activities.

The Primary Purpose of Calculating Standard Cost Variances Each Period