Material
FOQ:
Costing
J2CODI
ordering
Ordering
Holding
Demand
Ch
Cox
cost:
cost:
cost 1
Holding
cost
ChxFOQ2
No of order:
Demand
Time between
order:
how
output,
b:
VC /Unit:
cost
+
1
of
fixed cost:
a bx
week
y: cost.y depend
No
order
on
X
( vclumit
x
slope:ye-y
Total
-
+
-
x1
cost
-
TC: FC+
output
( vclunitx
To tal
D
y:
a + bx
output)
-
&
a.
Annual
IFOQ
Working
X2
y:
holding
Method
x:
a:
unit
DIEOQ
Total Annual Cost: Annual
High
(Sales
VC
order
cost
Efficiency
Efficiency 1 Productivity
Labour
Expected
Ratio
standard Hours
:
E5A
Time Allowed
=
Time
>
<
Ratio
Actual
:
Budgeted
CAB
<
100%
volume
Ratio
standard
:
VSB
:
<
overhead
Ratio
Actual
of
by
(
,
>
AH
SH
✗
<
100
of
of
×
×
capacity
capacity
100
capacity
Output
<
Ratio
Budgeted Output
machine
machine
OH
or
cost
or
and
labour
machine
or
apportionment
hours
labour hours
per unit
labour hours taken
×
OH
Absorption
Amount Absorbed
:
OAR
✗
AH
BH )
allocation
Absorption Rate per
Production
=
SH
costing
Number
OH
worked CAH )
Hours ( SH )
Efficiency
.
inefficient
utilization
over
Hours
100%
.
Hours CBH )
Budgeted
Production OH cost
_
,
100
✗
efficient
under utilization
,
> 100%
-
Hours
✗
Taken
100%
100%
( SH )
worked CAH )
Actual Hours
Capacity
Hours
Actual
no
of machine
or
labour
hours
Rate
too
Over
=
absorption
Amount
Actual
=
:
:
:
production
Budgeted
under
=
absorbed
Actual
>
cost
Production
Budgeted
>
overhead cost
>
incurred
Actual
OH
absorption
Amount
Actual
absorbed
Production
Budgeted
OH cost
<
Actual
<
Budgeted
<
Actual
cost
incurred
Production
OH