ACC212Chap25

ACC212Chap25 - Chapter 25 STANDARDS AND VARIANCES IN COST...

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Chapter 25 STANDARDS AND VARIANCES IN COST ACCOUNTING SYSTEMS Determining the cost of manufactured products as well as the unit cost of those items is basic to cost accounting. In previous chapters we have dealt with actual or historical unit costs. In this chapter, we will address the use of standard costs ---a detailed estimate of how much it should cost to produce a unit of product---in evaluating managerial performance. Of course, if you develop standards, you will generally have variances or deviations from the standard. Standard Costs In Chapter 25 we dealt with the topic of budgetary control in some detail. The use of budgetary control procedures is often extended to the point of unit cost projections for each product manufactured. Cost systems using detailed estimates of each element of manufacturing cost entering into the finished product are referred to standard cost systems . Such systems enable management to determine how much a product should cost (standard), how much it does cost (actual) and the causes of any difference (variance) between the two. Standard costs
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This note was uploaded on 04/07/2008 for the course ACC ACC212 taught by Professor Prescott during the Spring '08 term at S. Alabama.

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ACC212Chap25 - Chapter 25 STANDARDS AND VARIANCES IN COST...

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