Answer (C) is correct . A standard cost is an estimate of what a cost should be under normal operating conditions based on studies by accountants and engineers. In addition, line management is usually involved in the setting of standard costs as are quality control personnel. Top management would not be involved because cost estimation is a lower level operating activity. Participation by affected employees in all control systems permits all concerned to understand both performance levels desired and the measurement criteria being applied.
Answer (A) is incorrect because Budgetary accountants are involved in the setting of standard costs.
Answer (B) is incorrect because Industrial engineers are involved in the setting of standard costs.
Answer (D) is incorrect because Quality control personnel are involved in the setting of standard costs.
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