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Question

Difference between standard cost and actual cost is called as:

A Wastage Correct Answer Incorrect Answer
B Loss Correct Answer Incorrect Answer
C Variance Correct Answer Incorrect Answer
D Profit Correct Answer Incorrect Answer
E Spoilage Correct Answer Incorrect Answer

Solution

The difference between standard cost and actual cost is termed as variance. Variance represents the deviation between the expected (standard) costs and the actual costs incurred in production or other business activities. It is used to analyze performance, identify areas of improvement, and take corrective actions.

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