Advanced In the new industrial environment, the usefulness of standard costing is being challenged, and new approaches sought.

One approach, pioneered by the Japanese, is to replace standard costs by target costs.

You are required

(a) to describe the problems associated with stan¬

dard costing in the new industrial environ¬ ment; (6 marks)

(b) to explain what target costs are, and how they are developed and used; (6 marks)

(c) to contrast standard and target costs.

(5 marks) (Total 17 marks) CIMA Management Accounting Techniques