Standard costs establish the minimum desirable costs, Cost Accounting

Assignment Help:

Standard Costs Establish the Minimum Desirable Costs

When actual costs incurred exceed or else are below the standard costs, we after that investigate the variances along with an objective to take suitable corrective measures. Standard costing, on another hand, is explained as the process of establishing predetermined estimates of the costs of products and services and comparing this along with the actual cost when they are incurred. Hence, it is an exercise that finds out the expected cost levels under specific conditions standard costs, after that applies the standard costs to the real performance or performance analysis so as to find out the difference or variance.  This variance can be good like favourable or bad like un-favourable depending on whether this is more or less than the standard; this is the basis of taking corrective action or Control. The difference needs to be further analyzed to find out how it came about. It is referred to as variance analysis and it is significant since it pinpoints the exact reasons of favourable (F) or unfavourable (U) deviation. Such purposes can be accurate so as to achieve the desired performance.


Related Discussions:- Standard costs establish the minimum desirable costs

Homework, i need help on my homework

i need help on my homework

Question, mojor elements of cost sheet

mojor elements of cost sheet

Calculate the tax base of the interest received, Prepare answers to each of...

Prepare answers to each of the following questions.  Assume a tax rate of 30%. (i) Harry Ltd has a balance of prepaid rent in the balance sheet amounting to $100 000 as at 30 Ju

Methods for resolving transfer pricing conflicts, what are the advantages a...

what are the advantages and disadvantages of marginal costs plus a fixed lump-sum fee?

Gains and losses on disposal, When assets are replaced during the anticipat...

When assets are replaced during the anticipated life of the project, or at the end of the anticipated life of the project, they are sold at their pre-determined scrap values. Incom

Compute the sales activity variance for each product, The next year's budge...

The next year's budget for Benny, Inc., is given below: Product 1-2 Sales $945,000-688500 Variable costs 459,900-297,000 Fixed costs 300,000-3

Goods and services tax, William Potter is a plumber currently operating as ...

William Potter is a plumber currently operating as a Sole Trader in Levin. William has approached you, a tax accountant, for your advice on certain tax matters. William's brothe

Example of job order costing, Example of Job Order Costing The giv...

Example of Job Order Costing The given transactions were made by a company in the month of December. Direct Materials a) 8,000/- was bought on credit, out of these

Overhead analysis, allocate the overheads to the three departments and do t...

allocate the overheads to the three departments and do the secondary allocation of service departments

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd