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use practical standards in establishing its budget. An analysis of the DM needed to create one hat is as follows: DM needed: 0.5 yards of

use practical standards in establishing its budget. An analysis of the DM needed to create one hat is as follows:

DM needed: 0.5 yards of felt

Anticipated wastage: 0.15 yards

Anticipated damaged felt: 0.05

Felt costs: $12 per yard

Delivery costs: $0.50 per yard

The DL needed is as follows:

DL needed: 2 hours

Allowance for inefficiencies: 0.25 hours

Pay rate: $10 per hour

Benefits: $1 per hour

Taxes: $1.80 per hour

What is the DM quantity standard?

What is the DL Price Standard?

What would be a disadvantage of using IDEAL standards in setting the budget?

a. Employees may be demotivated

b. It may lead to unethical behaviors

c. We will be very unlikely to meet the standards

d. All of the above are disadvantages

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