Uses of Standard Costs

1. Use of standard costs is an effective way for planning and controlling costs.
2. Pricing decisions and decisions involving submission of quotations, answering tenders
etc., are also facilitated by the use of standard costs.
3. Identification and measurement of variances from standards has been made possible
with the use of standard cost, with a view to improve performance or to correct loose
standards, if any.
4. Facilitates management by exception.