Explain two factors that should be considered when designing divisional performance measures.
Factors that should be considered when designing divisional performance measures. These include:
Each measure should be simple to calculate and to understand so that managers can see the effect of the decisions that they make on the measurement of their division's performance.
Each measure should be fair to the manager of the division and only include items that are within their control.
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Explain what is meant by standard costing
Explain what is meant by a standard cost
Describe four types of standard.
Explain what is meant by a standard hour.
Give five possible sources of information from which a standard materials price may be estimated.
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