A manufacturing company is engaged in uniform costing and participating in inter-firm comparison. What should be the primary focus of this comparison for effective cost management? Question 11Answer a. Reducing fixed costs to match industry standards. b. Enhancing variable costs to outperform competitors. c. Aligning cost structures with industry benchmarks. d. Ignoring industry comparisons to maintain independence.
The primary focus of inter-firm comparison for effective cost management in a manufacturing company engaged in uniform costing should be:
c. Aligning cost structures with industry benchmarks.
This approach allows the company to identify areas for improvement, understand competitive positioning, and implement strategies to enhance efficiency and reduce costs in line with industry standards.