Required

E$10-4$ As business organizations grow in size and complexity, cost control becomes more difficult. A system to provide information and assist in cost control is imperative for effective management. Management by exception is one technique that is often used to foster cost control.

Describe how a standard cost system helps to make management by exception possible.

Discuss the potential benefits of management by exception to an organization.

Identify and discuss the behavioral problems that might occur in an organization using standard costs and management by exception.

$($CMA$,$ adapted$)$