Quiz 9: Standard Costing: a Functional-Based Control Approach

Business

1.To compute the number of quarts of oil used for 980 oil changes, unit quantity standard is to be multiplied with actual output. img 2.To find out the number of direct labor hours used for 980 oil changes, unit labor standard is to be multiplied with actual output. img 3.If there had been 970 oil changes in June, the standard quantities of oil (in quarts) and of direct labor hours would take less number of oil quarts and less direct labor hours. The SQ of oil changes would be: img The SH of oil changes would be: img

The difference between standard cost and budget is: • Standard cost reflects the projected figure for a unit i.e. factory overheads materials or Output produced of each unit. • Budget reflects the amount set by an organization to meet the projected expense, revenues, and costs. It shows the available amount to send and spread over all expenses. For Example: Let's say in a manufacturing organization of notebooks of student, the production department set the cost of $2 to be for the paper to be used i.e. standard cost and the organization has set the budget of marketing of those notebooks in the market of $50,000 p.a.

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