COMMERCE 2AB3 Lecture Notes - Lecture 10: Cost Driver

• School: McMaster University
• Department: Commerce
• Course: COMMERCE 2AB3
• Professor: Karim Karim

Document Summary

Aqip = actual quantity of input purchased (total) Aqiu = actual quantity of input used (total) Aqi = actual quantity of input (eg. kg or m or l for direct materials or hrs for direct labour) (total) Api = actual price of input (per unit of input) Ari = actual rate of input (usually for dl hours or overhead rates) (per unit of input or cost driver) Spi = standard price of input (per unit of input) Sri = standard rate of input (usually for dl hours or overhead rates) (per unit of input or cost driver) Sqi = standard quantity of input per unit of output. Sq = sqi x aqo (total quantity of input allowed for total actual output) Sales volume variance (svv) = |aqo bqo| x bcm. = difference between net income of static budget and flexible budget. = market size variance + market share variance. = |amsize bmsize| x bcm x bmshare.