Inventory Turnover Ratio - meaning and formula.

What is standard hour?

Standard hour is the quantity of output or amount of work which should be produced in one hour. It is the measure used in standard costing by means of which products in different forms such as solid, liquid and gases are measured. 

In other words, a standard hour is expression of the actual output in terms of standard time instead of units. The concept of standard hour has a practical advantages in the measurement of efficiency ratio and activity ratio of the organization.

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