cornerstones chp 8

cornerstones chp 8 - Chapter 8 Standard Costing: A...

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May 26, 2011 Accounting 2102 1 Chapter 8 Standard Costing: A Managerial Control Tool
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Budgets versus Standards Budgets versus Standards chapter 7 versus chapter 8 budgets set benchmarks used to control and evaluation performance from an aggregate perspective standards set benchmarks used to control and evaluate performance from a per unit perspective per unit standards are developed on two levels price standards quantity standards May 26, 2011 Accounting 2102 2 Standards enable FLEXIBLE BUDGETING. (Chapter 9)
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“Mama, where do standards come from?” ∙ historical data ∙ engineering studies ∙ operating personnel ∙ standards should be challenging AND achievable why would a company choose to use standards? improves planning and control provides readily available cost information May 26, 2011 Accounting 2102 3
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VARIANCES budget variance = actual cost – planned cost 2 standards (see slide 2) . . . 2 variances . . . price variance quantity variance favorable versus unfavorable materiality May 26, 2011 Accounting 2102 4
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Calculating Variances . . . Direct Materials
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This note was uploaded on 05/26/2011 for the course ACCT 2102 taught by Professor Farmer during the Spring '08 term at UGA.

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cornerstones chp 8 - Chapter 8 Standard Costing: A...

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