Matakuliah
Tahun
: <<AKUNTANSI BIAYA II>>
: <<2009>>
STANDARD COSTING
Setting Standard and Analyzing Variances
Pertemuan 3, 4 dan 5
LEARNING OBJECTIVE
•Define Standard Cost and explain how standard are
used.
•Explain how standard are set.
•Compute Standard Cost of actual or equivalent unit
produced.
•Compute Standard Cost variances for Materials, Labor and
Factory Overhead (FOH).
•Define Standard Cost variances and state how their
causes can be determined.
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DEFINITION
• Standard Cost is the predetermined cost of
manufacturing a single unit or a specific quantity of
during a specific period.
• Standard Cost is the planned cost of product under
current or anticipated operating conditions.
• Component : physical standard and price standard
• A Standard is like a norm.
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USEFULNESS of Standard Cost
• Establishing budgets
• Controlling costs by motivating employees and
measuring operating efficiencies.
• Simplifying costing procedures and expediting cost
reports.
• Assigning costs to materials, work in process, and
finished goods inventories.
• Establishing contract bids and setting sales prices.
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SETTING Standards
• Calculating a standard cost requires physical
standards.
• Two types of physical standards are basic and current.
• Basic standard = as a yardstick, expected versus actual
• Current Standards are of three types :
• Expected Actual Standard.
• Normal Standard.
• Theoretical Standard.
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SETTING Standard
• Material and Labor standards generally are based on
normal, current condition, allowing for expected changes
in prices and reflecting desire efficiency.
• Overhead standards actually are based on normal
operating conditions, normal volume, and desired
efficiency.
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The SUCCESS of Standard
• Depend on the reliability, accuracy, and acceptance of
the standards.
• Depend on human behavior.
• Must be realistic, can be achieved.
• Can increase employee motivation to work harder.
• Standards usually are computed for a 6- or 12 month
period, although a longer period sometime is used.
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STANDARD COST CARD
• Once standards are set, a standard cost card should
be prepared for each product, showing the itemized cost
of each kind of materials and component part, labor
operation, and overhead cost for the product.
• A master standard cost card can be a paper document
or electronic record. Either way, the master standard
cost card for each product should be supported by
individual records that indicated how the standard were
determined.
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DETERMINING Standard Cost
• Setting Material Standard Cost
• = Price Standard x Quantity Standard
• Price Standard = Price Purchases + Freight + Receiving
Handling – Purchase Discount
• Quantity Standard = Material Requirement + Allowance
for waste and spoilage + Allowance for rejects.
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DETERMINING Standard Cost
• Setting Labor Standard Cost
• = Rate Standard x Direct Labor Hour Standard
• Rate Standard = Basic Wage Rate + Employee Taxes
(10%x Basic) + Fringe Benefit (30% x Basic)
• DLH Standard = Basic Labor Time + Allowance for
Breaks and Personal Needs + Allowance for cleanup
and machine downtime + Allowance for reject.
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DETERMINING Standard Cost Variance
• Differences between Standard Cost to Actual Cost is
named as variance.
• Two Standards are developed for direct materials costsa material price standard and a material quantity or
usage standard.
• Because carrying inventory is costly, inventory buildup
also can be reported as an unfavorable variance and
inventory reduction as a favorable variance.
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MATERIAL STANDARDS AND VARIANCES
• Material Purchase Price Variances
• = (Actual Price/unit-Standard Price/unit) x Actual
Quantity Purchase (AQP).
• Material Price Usage Variances
• = (Actual Price/unit-Standard Price/unit) x Actual
Quantity Used (AQU)
• Material Inventory Variances
• = (AQP-AQU) x Standard Price/unit
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LABOR STANDARDS AND VARIANCES
• Labor Rate Variance
• = (Actual Rate/hour-Standard Rate/hour) x Actual
Hours Worked (AHW).
• Labor Efficiency Variances
• = (AHW-SHA) x Standard Rate per hour
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FOH Standards and Variances
• Standard FOH Rate
= Total FOH/Direct Labor Hours
• Variable FOH Rate
= Total Variable FOH/Direct Labor Hours
• Fixed FOH Rate
= Total Fixed FOH/Direct Labor Hours
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Two-Variance Method
• Controllable Variance
• = Actual FOH – [(Standard Hours x Variable FOH Rate)
+ Budgeted Fixed FOH]
• Volume Variance
• = [(Standard Hours x Variable FOH Rate) + Budgeted
Fixed FOH] – (Standard Hours x Standard FOH Rate)
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Three-Variance Method
• Spending Variance = Actual FOH – [( Actual Hours x
Variable FOH Rate) + Budgeted Fixed FOH]
• Variable Efficiency Variance = [( Actual Hours x
Variable FOH Rate) + Budgeted Fixed FOH] - [(Standard
Hours x Variable FOH Rate) + Budgeted Fixed FOH].
• Volume Variance = [(Standard Hours x Variable FOH
Rate) + Budgeted Fixed FOH] – (Standard Hours x
Standard FOH Rate).
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Mix Variance
• Mix Variance is a variance representing the differences
between the standard cost of formula materials and the
standard cost the material actually used can be
calculated.
• Mix Variance is the result of mixing basic materials in a
ratio that differs from standard material specifications.
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Yield Variance
• Yield Variance as the amount of product manufactured
from a given amount of materials.
• Yield Variance is the result of obtaining a yield different
from what would be expected from actual input.
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CAUSES of Variances
• Material Variance : purchasing uncertainly, fortunate
buy, unexpected inflation, an excess or shortage of
quantity available in the market, etc.
• Labor variance : inefficiency labor, pilferage, or theft,
badly worn or new machine, etc.
• FOH Variance : production inefficiency, capacity
problem, etc.
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Alternative Three-Variance Method
• Spending Variance = Actual FOH – [( Actual Hours x
Variable FOH Rate) + Budgeted Fixed FOH]
• Idle Capacity Variance = [( Actual Hours x Variable
FOH Rate) + Budgeted Fixed FOH] – [Actual Hours x
FOH rate].
• Efficiency Variable = [Actual Hours x FOH rate] –
[Standard Hours x FOH Rate].
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Four-Variance Method
• Spending Variance = Actual FOH – [( Actual Hours x
Variable FOH Rate) + Budgeted Fixed FOH]
• Variable Efficiency Variance = [( Actual Hours x
Variable FOH Rate) + Budgeted Fixed FOH] - [(Standard
Hours x Variable FOH Rate) + Budgeted Fixed FOH].
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Four-Variance Method
• Fixed Efficiency Variance
= [Actual Hours Worked – Standard Hours] x Fixed FOH
Rate
. Idle Capacity Variance = [( Actual Hours x Variable
FOH Rate) + Budgeted Fixed FOH] – [Actual Hours x
FOH rate].
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CONCLUSION
•
•
•
•
•
Setting Standards and how to use standards.
Computed Variance and Analyzing Variances.
Variance : Material, Labor and FOH
Mix and Yield Variance
Causes of Variance, and control to Variance
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