flexible budgets, variances, and management control i文档文档.pptVIP

Cost Accounting Horngreen, Datar, Foster Learning Objective 3 Use standard costs in variance analysis * Cost Accounting Horngreen, Datar, Foster Sources of Information The two main sources of information about budgeted input prices and budgeted input quantities are: Actual input data from past periods Standards developed * Cost Accounting Horngreen, Datar, Foster Standards A standard input is a carefully predetermined quantity of inputs (such as pounds of materials or manufacturing labor-hours) required for one unit of output. A standard cost is a carefully predetermined cost that is based on a norm of efficiency. Standard costs can relate to units of inputs or units of outputs. * Cost Accounting Horngreen, Datar, Foster Standards Rockville’s budgeted cost for each variable direct cost item is computed as follows: Standard input allowed for one output unit Standard cost per input unit × * Cost Accounting Horngreen, Datar, Foster Standards The following standards were developed for Rockville Company: Direct materials: 4.00 square yards of cloth input allowed per output unit (suit) purchased at $16.25 standard cost per square yard. Standard cost per output unit manufactured = 4.00 × $16.25 = $65.00 Direct manufacturing labor: 2.00 manufacturing labor-hours of input allowed per output unit (suit) manufactured at $13.00 standard cost per hour. Standard cost per output unit manufactured = 2.00 × $13.00 = $26.00 * Cost Accounting Horngreen, Datar, Foster Learning Objective 4 Compute the price and efficiency variances for direct cost categories * Cost Accounting Horngreen, Datar, Foster Price and Efficiency Variances Level 3 analysis separates the flexible-budget variance into price and efficiency variances. The following relates to Rockville Company: Direct materials purchased and used: 42,500 square yards Actual price paid per yard: $15.95 Actual direct manufacturing labor hours: 21,500 Actual