Budgeting and standard costing

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1 Budgeting and standard costing
made by 刘瑞婧 张弛 邹文君

2 Standard costs a standard cost is an estimated unit cost built up of standards for each cost element(standard resource price and standard resource usage) Standard costing standard costing is used to value inventories ,prepare cost budgets for production and provide control information(variances)

3 materials costs 直接材料标准成本=材料的标准价格*单位产品的用量标准 材料用量标准 材料的价格标准
材料用量标准 材料的价格标准 （工程技术部门） （采购部门） purchase contracts pricing discussions with suppliers bulk purchase discounts quality of material ......

4 labour costs 直接人工标准成本=小时工资率*单位产品的工时标准 工资率标准 * 工时标准 （人力资源部门） 单位产品所需要的时间

5 material usage and labour efficiency
technical specifications must be prepared by production experts

6 overheads 变动制造费用 变动性制造费用标准分配率*单位产品直接人工（或机器）工时标准总工时 固定制造费用（变动成本法，制造成本法）
固定制造费用标准分配率*单位产品直接人工（或机器）工时标准总工时

7 sales price and margin standard selling price 预期的市场需求 制造费用 竞争产品
可能的价格膨胀 standard sales margin difference between the standard cost and standard selling price

8 Flexible budgets Definition: flexible budget is a budget which , by recognizing different cost behavior patterns , changes as volume of activity (output and sales) changes. Difference with fixed budget 1.The major purpose of fixed budget is for planning. But the flexible budget is applied in planning and controlling, the main purpose is to control. 2. A fixed budget does not change throughout the budget period ,regardless of any changes in the actual volume of activity. But A flexible budget recognizes cost behavior and changes as the actual volume of activity changes.

9 Preparation of a flexible budget
Step1 : determination of cost behavior patterns(cost are fixed ,variable cost or mixed cost). Step2 : calculate the budget cost allowance for each cost item. Budget cost allowance = budgeted fixed cost* + (number of units variable cost × per unit)** * nil for variable cost ** nil for fixed cost Semi-variable costs 是指其成本发生额虽随着业务量的增减而有所变动，但不保持严格的比例关系的那部分成本.这种成本通过一定方法（high-low method）可以分解为固定成本和变动成本两部分。

10 Variance analysis between fixed budget and actual result
销量差异=(实际销量-静态预算销量) ×单位标准售价- (实际销量- 静态预算销量) ×单位标准产品成本 或=(实际销量-静态预算销量) ×单位边际贡献 b. 弹性预算差异 弹性预算差异建立在实际销量或产量的基础上计算的，差异部分 是实际售价 vs 标准售价，以及实际产品成本 vs 标准产品成本等的差异。弹性预算差异揭示了在同一实际销量或产量基础上销/产这么多量应该发生多少销售收入和产品成本和实际发生的销售收入额和产品成本的差异。

11 明确差异责任主体(control) 根据差异分析原因分析，明确责任主体，督促相关部门制定改善措施并限期整改(take corrective action or amend the plan in the light of actual events)。例如销售收入差异责任主体部门为销售部门，生产成本差异中材料价格差为采购部门，材料组合（配方）差异为技术部门与生产部门，材料用量差异为生产部等。

12 The advantage of flexible budget
它不以计划数作为简单的评价依据，而是将计划数中计划产量调整为实际产量计算弹性预算数作为评价依据. 运用弹性预算数评价企业内部生产单位经营业绩既客观，又科学. 运用弹性预算数还能对企业内部生产单位未来的经营业绩进行实时监控。 The disadvantage of flexible budget splitting mixed cost is not always straightforward fixed cost may be step cost as activity levels increase/decrease Manager may become confused and frustrated if faced with continually moving targets. Many cost items in modern industry are fixed cost ,the value of flexible budget in planning (but it can be used for budgetary control variance analysis)is dwindling.

13 The principle of controllability
It is that managers of responsibility centres should only be held accountable for costs over which they have some influence. Budget centres Controllable costs

14 Budgeting control is based around a system of budget centres.
The selection of budget centres in an organisation is therefore a key first step in setting up a control system.

15 A well-organised system of control should have the following features
1. A hierarchy of budget centres 2.Clearly identified responsibilities for archieving budgeting targets 3. Responsibilities for revenues,costs and capital employed

16 controllable costs Controllable costs are items of expenditure which can be directly influenced by a given manager within a given time span. The controllability principle is that managers of responsibility centres should only be held accoutable for costs over which they have some influence.

17 controllable and uncontrollable costs
1.A cost which is not controllable by a junior manager might be controllable by a senior manager. 2.A cost which is not controllable by a manager in one department may be controllable by a manager in another department. 3.Most variable costs within a department are thought to be controllable in the short term. 4.Other costs are controllable,but in the long term rather than the short term.