Task: The setting of standards is critical to the effective use of standards in evaluating performance.
Explain the following in a memo.
1) The comparative advantages and disadvantages of ideal versus normal standards.
2) The factors that should be included in setting the price and quantity standards for direct materials, direct labor, and manufacturing overhead. (Kimmel 1183)
Reference: Kimmel, Paul D. Accounting: Tools for Business Decision Making, 4th Edition. John Wiley & Sons, 07/2011. VitalBook file.