Accounting Principles Standard Costs and Balanced Scorecard参考.pptx

25Standard Costs and Balanced ScorecardLearning ObjectivesDescribe standard costs.1Determine direct materials variances.2Determine direct labor and total manufacturing variances.3Prepare variance reports and balanced scorecard.4Describe standard costs.LEARNINGOBJECTIVE1Distinguishing Between Standards and BudgetsBoth standards and budgets are predetermined costs, and both contribute to management planning and control.There is a difference: A standard is a unit amount. A budget is a total amount.LO 1AdvantagesIllustration 25-1LO 1Setting Standard CostsSetting standard costs requires input from all persons who have responsibility for costs and quantities.Standards should change whenever managers determine that the existing standard is not a good measure of performance.LO 1Setting Standard CostsIDEAL VERSUS NORMAL STANDARDSCompanies set standards at one of two levels: Ideal standards represent optimum levels of performance under perfect operating conditions. Normal standards represent efficient levels of performance that are attainable under expected operating conditions.Properly set, normal standards should be rigorous but attainable.LO 1Setting Standard CostsQuestionMost companies that use standards set them at a(n): optimum level. ideal level. normal level. practical level.LO 1Accounting Across the OrganizationNavyHow Do Standards Help a Business?A number of organizations, including corporations, consultants, and governmental agencies, share information regarding performance standards in an effort to create a standard set of measures for thousands of business processes. The group, referred to as the Open Standards Benchmarking Collaborative, includes IBM, Procter and Gamble, the U.S. Navy, and the World Bank. Companies that are interested in participating can go to the group’s website and enter their information. Source: Becky Partida, “Benchmark Your Manufacturing Performance,” Control Engineering (February 4, 2013).LO 1Setting Standard CostsA CASE STUDYTo est