ACC3200 Study Guide - Final Guide: Management Accounting, Purchasing Manager, Global Sourcing

• School: Monash University
• Department: Business - Accounting
• Course: ACC3200
• Professor: Ahmad Sujan

Document Summary

The levels of variances: (only level 3 will be on the exam) Level 0 = diff bw actual and budgeted operating income. The highest level of analysis, a super macro view of operating results. Dig deeper to find out where and why we went wrong. Level 1 = the variances of each area. If you sell less units, you"ll earn less revenue = . If you sell less units, production costs should be less, not more = Level 2 = compare standards from the flexible budget to the actual figures. Flexible budgets alter budgeted revenues and costs based on actual activities. Flexible budgets allow level 2 and 3 variances to be calculated. Change price/cost per unit based on the static budget and then apply that to the actual units sold. 10k (actual units sold) x = . 2m. Fixed costs don"t change based on no. of units sold = remain constant.