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It is a management by exception accounting system. You forecast by knowledge or history what your material costs may be (usage and cost) and your labor(hourly rates and production units) and the estimated overhead for a period of production and then measure the actual results against the standard. Rather than reviewing all costs - you review only the variances and the reason why and the cost drives that generated the variances. You can determine whether those cost drivers can be controlled and apply those measures or eventually set them as a part of the standard cost value.
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What are the advantages and disadvantages of weighted average cost?
The advantages of using weighted average cost is that it is consistent, the formula is very simple to use and their is less paperwork. This method, however, makes it difficult to follow the ups and downs of the market if prices change frequently.
What is the difference between Standard Cost and Actual Cost?
In standard costing system standard costs for all activities are established for better controlling purpose as well as budgeting purpose so standard cost is that cost which is management expects to occurs if some activity is performed but actual cost is the cost which actually spend to perform specific activity and both costs may be same or different due to many reasons and variance analysis is done to find out the reasons for differences.
Difference between histotical cost and standard cost?
Standard cost is the cost which is basis to measure the actual cost historical cost is the initial cost
What are the advantages and disadvantages of cost classification?
the disadvantages of cost classification
Advantages and disadvantages of fair trade?
There are a number of advantages and disadvantages to the fair trade system. Advantages include fair wages, a higher profit, and safer working conditions. Disadvantages of fair trade include the cost of certification and the favoring of co-ops over individuals.
Advantages kg disadvantages of using inorganic refrigerants?
There are several advantages and disadvantages of using 1 KG inorganic refrigerants. Some of the advantages and disadvantages are cost, energy efficiency, safety issues, and system issues.
What are the advantages of using a pneumatic thermostat in a commercial HVAC system?
The advantages of using a pneumatic thermostat in a commercial HVAC system include precise temperature control, reliability, cost-effectiveness, and compatibility with existing pneumatic control systems.
Advantages and disadvantages of cost management system?
advantages of cost management in relation to finacial efficiency
Advantages and disadvantages of standard mail?
The major advantages of using standard mail is the low cost of postage and increase in postage rates along with increase in weight. On the downside, the disadvantages include slow delivery, weight restriction and flexibility in returning mail.
What are some advantages to using a construction management system?
Some advantages of using a construction management system is that they provide an objective representation to protect the projects best interest. They can reduce overall production cost. The company would have centralized communication and enhanced quality control.
What are some advantages of using the BNSF railroad?
Advantages of using the BNSF railroad include cost savings, fast delivery of goods, the opportunity to deliver to places otherwise unreachable by standard methods, the chance to have reliability in your delivery service and a decrease in carbon footprint.
What are the advantages and disadvantages of using computerized and noncomputerized information systems?
Cost
What are the advantages of using a plastic base for a product?
Using a plastic base for a product offers advantages such as durability, lightweight, cost-effectiveness, and versatility in design.
What are the advantages of using a push mower?
There are many advantages for one when using a push mower. The most significant advantages being no fuel cost and more exercise for the one mowing the lawn.
Advantages of a knowledge based system?
knowledge base system save time,cost and effort.
Is Standard Cost same as actual cost?
Standard cost is that cost which is budgeted at start of production while actual cost is that cost which actually incurred by business both of them can be same if actual cost incurred is same as allocated or determined in budgeting process using standard cost otherwise there will be difference.
The advantages and disadvantages all type of power generation system based on the factors cost and fuel availability?
The advantages and disadvantages all type of power generation system based on the factors cost and fuel availability?
