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Summary QuestionWhen recording journal entries for production costs using a standard cost accou $7.99
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Summary QuestionWhen recording journal entries for production costs using a standard cost accou

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When recording journal entries for production costs using a standard cost accounting syste1QuestionWhen recording journal entries for production costs using a standard cost accounting system, the favorable variances are recorded as ______ and the unfavorable variances are recorded as ______. ...

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  • October 13, 2024
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Question


When recording journal entries for production costs using a standard cost

accounting system, the favorable variances are recorded as ______ and the

unfavorable variances are recorded as ______. Multiple choice question. debits;

credits credits; debits debits, debits credits; credits




Answer & Explanation


In a standard cost accounting system, variances are recorded to reflect the

differences between actual costs and standard costs.


 Favorable variances occur when actual costs are less than standard costs,

which is beneficial for the company. These are recorded

as credits because they represent a reduction in expenses or an increase

in income.


 Unfavorable variances occur when actual costs exceed standard costs,

which is detrimental to the company. These are recorded

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