Using Chapter 7 of your text as a reference, define a standard cost and explain what constitutes the components of a standard cost. Describe the advantages and disadvantages of a standard cost system and explain under what circumstances a standard cost system is most effective. Your initial post should be 250 words.

Text is Managerial accounting: Decision making for the service and manufacturing sectors(2012). San Diego, CA: Bridgepoint Education

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Standard cost is defined as the estimated cost of producing a product or service under standard operating conditions. To determine the standard cost of a unit of a product, management usually considers the cost of the raw materials used in the production process, labor cost, factor overhead, amount of materials used, duration of the involved labor and the quantity of the …

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