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Hi John!
1.In a standard costing environment, managers are usually held responsible for variances.
2.However in a TQM or JIT environment where standard costing is not applicable, then who is held responsible if something goes wrong or how would the business know that may be the production department or sales department has not done their job well?
Thanks.
It will still be the relevant managers who will be held responsible.
It is up to the company to design performance measures (both financial and non-financial) that measure how well respective managers are performing. (Variances are just one example of financial performance measures.)
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