Subject: Cost management & accounting Q.1 Direct Material = Rs. 50,000 Direct Labour = 75,000 Rent (Factory) = 5,000 Fuel & Power = 2,000 Rent (Office) = 3,000 Utility (Factory) = 3,000 Utility (Office) = 1,500 Factory Supervisor Salary = 5,000 Depreciation( Machines = 2,000 Indirect Material = 10,000 Indirect Labour = 5,000 Compute: i) Prime Cost ii) Factory Over Head iii) Factory Cost iv) Conversion Cost
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.
Subject: Cost management & accounting
Q.1
Direct Material = Rs. 50,000
Direct Labour = 75,000
Rent (Factory) = 5,000
Fuel & Power = 2,000
Rent (Office) = 3,000
Utility (Factory) = 3,000
Utility (Office) = 1,500
Factory Supervisor Salary = 5,000
Depreciation( Machines = 2,000
Indirect Material = 10,000
Indirect Labour = 5,000
Compute: i) Prime Cost ii) Factory Over Head iii)
iv) Conversion Cost
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