standard cost

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standard cost

n
(Accounting & Book-keeping) accounting the predetermined budgeted cost of a regular manufacturing process against which actual costs are compared
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As more manufacturers move to Toyota-style Lean management, some CFOs are asking a controversial question: Is it time to move away from standard costing and variance analysis (SCVA)?
It covers financial record keeping, income statements, the balance sheet, checking the double-entry system, accounting for various types of business organizations, business and standard costing, marginal costing and decision making, budgeting, working capital management, capital investment appraisal, limited companies and published accounts, accounting standards, statement of cash flows, and accounting ratios.
This activity can be done within a problem structure format for several topics, but the focus for this paper is on standard costing variance analysis, a sometimes difficult topic for principles of accounting students.
Added functionality for drop ship, standard costing, general ledger, and increased ACH handling enhancements were satisfied in this release.
Do mature lean manufacturers continue to use standard costing and variance analysis?
The study revealed that standard costing systems are still the most popular, especially in the production function of the internal value chain (42 per cent use standard costing compared to only 18 per cent for ABC).
In this way, standard costing "winds up creating a problem [by] giving off a signal that our costs are actually lower than they appear on the profit and loss statement," Medley said.
The final section covers traditional managerial accounting topics of classifying costs, job order costing, direct and absorption costing, and standard costing.
Overhead is still allocated based on direct labor (often requiring overhead rates of 600% or more because direct labor is so low); standard costing systems are still used to establish prices; complex systems are still used to value inventory; and financial accounting is still used to measure and monitor operations.
Traditional histories of cost accounting, such as Littleton [1933], Solomons [1952], Garner [1954], and Wells [1978], among others, have supported standard costing specifically as a key component of what Solomons [1952, p.
And standard costing compares predicted against actual costs to identify areas that vary significantly from the forecasted costs of performing a task.

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