Answer:
The answer is b) Standard cost
Explanation:
The standard cost that is based on normal efficiency levels, based on budgeted direct and indirect costs. It is a measure of how much it should cost to produce a unit of product. It is made up of the costs of the components required to make said product. For example, the standard cost to produce a leather shoe includes:
-Cost of direct materials (leather, laces, etc.).
-Cost direct labor (refers to the time required to cut the design, sew it, etc., multiplied by the production rate of employees who are in the process)
-Indirect or manufacturing costs related to the product (depreciation of the skin-cutting machine, electricity, etc.)
Standard costs serve as a benchmark that allows comparison with current costs.
