ACC-ACF3200 Lecture 2 2016 S1 (vs) (1)_图文.ppt

ACC3200-ACF3200Management Accounting,Lecture 2: Standard costing and variance analysisPrepared by Aldónio Ferreira,Lecture Outline,Control and the use of variancesStatic-budget variances & flexible-budget variances Standard costsCalculating standard cost variancesInvestigating significant variancesFlow of costs through manufacturing accountsAn appraisal of standard costing systems,1. Control and the use of variances,Control and the use of variances,Budgets quantify the expectation of management’s plan of actionBusinesses are ‘in control’ when operations plan and achieve objectives The implementation of plans typically lead to different outcomes than those planedIncreasingly so in complex environmentsleads to variancesControl systems provide regular information to assist in control by providing information about variances (i.e. deviations from expectations),Control and the use of variances,Variance – difference between an actual and an expected (budgeted) amountMAs breakdown the variances into subcomponentsunderstanding possible reasonsquantifying the magnitude of the different factorsNot all variances are worth investigationFocus on the most significant variancesManagement by exception – the practice of focusing attention on areas not operating as expected (budgeted),2. Static-budget variances & flexible-budget variances,Static budget variances,Static (master) budget – is based on the output planned at the start of the budget periodStatic-budget variance – the difference between the actual result and the corresponding static-budget amountFavourable variance (F) – has the effect of increasing operating income relative to the budget amountUnfavourable variance (U) – has the effect of decreasing operating income relative to the budget amount,,,,8,Static budget variances,Static budget variances,The highest level of analysis; a super macro view of operating resultsNothing more than the difference between actual and static-budget operating incomeFurther analysis decomposes (breaks down) the analysis into progressively smaller and smaller componentsProgressively more detailed levels of analysis:From ‘How much were we off?’…… to ‘Where and why were we off?’,Flexible Budget,Flexible budget – calculates budgeted revenue and budgeted costs based on the actual output for the periodThe most appropriate benchmark for controlMay be calculated for a range of levels of activityShifts budgeted total revenues and costs up or down based on actual operating results (activities)Represents a blending of actual activities and budgeted dollar amountsWill allow for preparation of more detailed variances‘Why were we off?’,Flexible Budget,,,,,11,Actual Quantity xBudgeted prices and costs,,$120 x 12,000,$58 x 12,000,$2 x 12,000,,,,Level 2 Analysis Illustrated,,,,12,Flexible-budget variances and sales-volume variances,,Sales variances,,14,Breaking down of sales variances,15,,16,Let’s now have a closer look at variances in costs,3. Standard costs,Standard cost,Standard cost is a carefully determined cost based on standard quantity and standard pricepredetermined cost of one unit of productIncludes cost of material, labour and overheads (fixed and variable)Standard costs are very important for planning and controlTypically part of the budgetary control systemYet, standard cost should NOT be confused with budget cost (budgeted costs are not necessarily standard costs, but standard costs are necessarily budgeted),Standard cost,,,Also refers toStandard Rates,Standard cost,When cost variances are significant, the cause of the variance must be investigatedMay result in changes to operations to bring cost back in line with standardsMay lead to reconsideration of the appropriateness of standard costsThe cause of significant cost variances should be investigated for all costs, not solely for product costs (i.e. DM, DL, VOH, FOH)Standard cost variances are used to evaluate actual performance and control costs…but before we have a closer look at variances, let’s explore how standards are set.,Setting standards,A variety of methods may be used to set cost standardsAnalysis of historical dataEngineering methodsParticipation by managers/employees in standard setting may lead to greater commitment to meeting those standards,Analysis of historical data,May provide a good basis for predicting future costsOften need to adjust predictions to reflect price or technological changes,Analysis of historical data,Engineering methods,The focus is on what the product should cost in the futureHow much material should be required and how much direct labour should be usedTime and motion studies can determine how long each step in a production process should take,Engineering methods,Analysis of historical data OR Engineering methods?,So which method tends to be used?In practice, a combination of methods is likely to be used, although historical data is more common for going concern companies.…How difficult should standards be?,。