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Course: Standard Costing

Standard Costing

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  • Certificate on Completion
  • Access on Android and iOS App
About this Course

This course comprises 4 1/2 hours of teaching on Standard cost variances, the reconciliation of statements and ledger accounts.

There are 6 videos in total of approximately 45 minutes each.

The primary objective of this course is to educate you for life and for your future career as an Accountant who understands how to maximise company profits. The secondary objective is to teach you in a manner that helps you to pass examinations.

  • Video 1   -  Standard costing overview

This video will teach you the fundamentals of Standard costing - why variances are calculated and the objective of reconciling the Budget profit to the actual profit. It will also introduce you to the ledger accounts that are required for a fully integrated Standard costing system.

  • Video 2   -  Material variances

Here you will learn how to calculate all the relevant material variances and how to reconcile Budget cost to Actual cost.

  • Video 3   -   Labour and Variable cost variances

As per Material - variances plus reconciliation.

  • Video 4   -   Fixed cost variances

You will learn the difference between variable and absorption costing systems, the variances for each one and the reconciliation of Budget to Actual.

  • Video 5   -  Sales variances

Sales variances are analysed by value and by profit plus the reconciliation of Budget profit to Standard profit to Actual profit

  • Video 6   -   Tutorial questions

In this session I will teach you how to read a question and how to answer a Standard costing question.

Basic knowledge
  • Students should have a basic Financial Accounting standard at the first year level. Basis knowledge of ledger accounts, Balance sheet and Income Statement is required
  • With regard to Managerial Accounting - no prior knowledge is required. This course takes students from a zero knowledge base to an Advanced level
What you will learn
  • Material variance calculations - Material price, mix, yield and Usage variance
  • Labour variances - Rate, efficiency and capacity usage
  • Variable cost variances - Expenditure and efficiency
  • Fixed cost variances - Variable cost expenditure. Absorption costing Expenditure and Volume variances
  • Sales variances - Price, volume, Quantity and Mix

You will also learn how to enter the variances in the ledger accounts and how to reconcile the Budget cost to Actual cost.

Reconciliation of Budget profit to Standard profit - to Actual profit is taught in detail.

Curriculum
Number of Lectures: 6
Total Duration: 04:23:03
Standard costing overview
  • Standard costing overview  

    At the end of this section you will be able to create a Flexed budget and to reconcile the Budget profit to Standard profit.


    Video 1 will give you an overview of Standard costing, the purpose of variance analysis and how you reconcile and explain the Budget profit to Standard profit and then to the Actual profit.

Material Variances
  • Material variances  

    You will be able to calculate the material variances, do the ledger accounts and reconcile Budget costs to Actual costs.


    This section will teach you how to analyse Raw material purchases into the three variances - the price, the mix and the yield. You will also learn how to make the required journal entries, determine the value of closing stock and inter-account transfers.

Labour and Variable cost variances
  • Labour and Variable cost variances  

    You will be able to calculate Labour and Variable cost variances, do the ledger accounts and reconcile the Budget to Actual cost.


    This section will teach you how to analyse Labour and Variable costs into the following variances -

    Labour rate, efficiency and capacity usage variance.

    Variable expenditure and efficiency.

    You will also learn how to make the required journal entries, determine the value of closing stock and inter-account transfers.

Fixed cost Variances
  • Fixed cost variances  

    Analyse the fixed cost variances and reconcile the ledger accounts

    This section will teach you how to analyse Fixed cost variances into the following variances -

    Expenditure variance for a Standard Variable costing system

    Expenditure and volume variance for a Standard absorption costing system.

    You will also learn how to make the required journal entries, determine the value of closing stock and inter-account transfers.

    Resources

Sales variances
  • Sales variances  

    You will be able to determine all of the sales variances and reconciliations.


    This section will teach you how to analyse Sales variances into the following variances -

    Sales price, Mix and Quantity.

    You will also learn how to make the required journal entries and reconcile the Budget profit to Standard profit, to Actual profit.

Tutorial Questions
  • Tutorial Questions  

    You will learn how to answer tutorial questions


    This final section will take you through tutorial questions and teach you how to answer a question and how to maximise your marks in examinations

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