Standard Costing Flashcards Preview

A2 Accounting > Standard Costing > Flashcards

Flashcards in Standard Costing Deck (10):
1

Standard Costing

Sets levels of cost / revenues which should be achievable with reasonable levels of efficiency.

2

Budget

A financial plan for a future period of time for costs and / or revenues based on a firms objectives.

3

Variance

The difference between budgeted and actual levels of cost / revenue.

4

Sub-Variance

A constituent part of a total variance. Add together to get total variance.

5

Adverse Variance

Has a negative effect on profit.

6

Favourable Variance

Has a positive effect on profit.

7

Material sub-variances

Material usage sub-variance
Material price sub-variance.

8

Direct labour sub-variances

Direct labour efficiency sub-variance
Direct labour rate sub-variance.

9

Flexed Budget

Check if actual output is different to budgeted output.
If so, replace budgeted output with actual output.
ONLY CHANGE SQ.

10

Sales Sub-Variances

Sales Volume Sub-Variance
Sales Price Sub-Variance