Question

Difference between standard costing and historical costing by table

Answer 1

Difference # Historical Cost:

1. It is an after-production-recorded cost.

2. It is, actually, incurred cost.

3. As it relates to the past, it is not useful for cost control.

4. It is used to ascertain the profit or the loss incurred during a period.

Difference # Standard Cost:

1. It is a predetermined cost.

2. It is an ideal cost.

3. It is a future cost. It can be used for cost control.

4. It is used for the measurement of operational efficiency of the enterprises.