Given below are two statements: one is labelled as Assertion (A) and the other is labelled as Reason (R).
Assertion (A): Inventories are a standard used to gauge performance in the production area.
Reason (R): Quantity, quality and cost are standards used to gauge performance in the production area.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → (A) is false but (R) is true.
Assertion (A): Inventories are a standard used to gauge performance in the production area. — False. Inventories are a standard used in the finance and accounting area, along with capital expenditures, flow of capital and liquidity.
Reason (R): Quantity, quality and cost are standards used to gauge performance in the production area. — True. Production performance is judged by quantity, quality and cost, and also by individual job performance.
NCERT (2026-27 Edition):
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