MGM222H5 Lecture Notes - Lecture 11: Balanced Scorecard
Standard costing- MGM222
- Primarily manufacturing or service companies or restaurants or non-profit
Overview:
1) Materials (actual) MPV (budget) MQV (applied)
Labour LRV LEV
VMOH Spending efficiency
FMOH spending volume
2) who is responsible
3) appendix- journal entries
Standards and budgets:
- Standard costing advantages:
◼ Facilitate management planning
◼ Done in a timely manner
◼ Help set selling prices
◼ Within someone’s control- controllability
- Setting standard costs
◼ Requires input from all persons who have responsilibyt for costs and quantities
- Two levels
- Spoilage?
◼ Normal = within the production process- not perfect
◼ Abnormal= machines and humans make mistakes
- Variances from standards
◼ Unfavorable: too much is paid for manufacturing cost elements such as materials and
labours or when there are inefficiencies in using materials and labour
◼ Favorable: when there are efficiencies in incurring costs
Formulas:
find more resources at oneclass.com
find more resources at oneclass.com
