RSM260H1 Lecture Notes - Cost Driver, Deutsche Luft Hansa, Statistical Process Control
Document Summary
A standard is a benchmark or more for measuring performance. Management by exception: a system of management and rights standards are set for various operating activities that are then periodically compared to actual results. Any differences that are deemed significant are brought to the attention of management as exceptions . *** exhibit 10. 1 the various analysis cycle*** The cycle begins with the preparation of standard costs performance reports in accounting department which highlights the variances which is the difference between the actual results and what should have occurred according to the standards. The significant variances are investigated to discover then promote causes and corrective actions are taken and then the next period is operations are carried out. Manufacturing companies often have highly developed standard costing systems in which standards relating to materials, labor, and overhead are deadlocked in detail for each separate product.
