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Managerial Accounting

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Standard Costs for Cost Measurement

MGRACT-X5EVEX

Leo Corp noticed that it consistently sees favorable variances when it compares its actual costs incurred to standard cost.

What does this feedback potentially suggest about the standard cost data?

A

The company should re-evaluate standard cost estimates because of inaccurate cost measurement

B

The company is extremely efficient

C

Actual results information could be wrong

D

Management is too aggressive in its decision making