The use of standard costs in pricing and budgeting is quite valuable since decisions in the fields of pricing and budgetary planning are made before the costs under consideration are incurred. Discuss. 4. What type of variances are computed for materials, labour, and factory overhead?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
3.The use of
since decisions in the fields of pricing and budgetary planning are
made before the costs under consideration are incurred.
Discuss.
4. What type of variances are computed for materials, labour, and
factory
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