Difference between standard cost and actual cost.
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 6Q: Explain the difference between a period cost and a product cost.
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A standard cost is a pre-determined or pre-established cost to make a unit of finished product. Actual cost is the actual cost of direct materials, direct labor, and overhead to make a unit of product. The difference between actual cost andstandard cost is called variance.
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