standard cost

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Fig. 78 Standard cost. Table showing the standard cost of an upholstered chair.

standard cost

an estimated product cost, prepared in advance of production, that shows what a product ought to cost given reasonably efficient working. Standard cost includes the direct materials cost of the product, direct labour cost and production overheads, as well as distribution, selling and administration overheads. Overheads are charged to products using an appropriate COST RATE derived by dividing budgeted overheads by budgeted output. Fig. 78 shows a simplified standard cost for a product. Such predetermined standard costs are used to provide a basis for price fixing and for cost control through VARIANCE ANALYSIS. See also DIRECT-LABOUR COST VARIANCE, DIRECT-MATERIALS COST VARIANCE, OVERHEAD-COST VARIANCE.
References in periodicals archive ?
The WIP inventory account gets the standard costs for the actual units produced.
2014 EAFRD Regulation (EU) No 1305/2013 must apply to aid granted on the basis of standard costs or additional costs or income losses, confirmed by a functionally independent body be that the calculations are appropriate and correct.
Low levels of inventory can be valued at actual cost, but high levels of inventory require the use of estimated costs or standard costs.
Made with hardy winter wheat from the southern steppes and the soft natural glacial water of Lake Ladoga, Russian Standard costs pounds 11.
Tableau Standard costs $795, while Tableau Professional is $1,349.
Although doctoral students traditionally receive financial support to cover tuition and fees during the program, as well as stipends to help cover living expenses, they do incur standard costs of living that often exceed this financial support.
A lack of standard costs across the country can see plumbers in the south-east of England asking customers to shell out pounds 130 an hour.
Using average or standard costs disguises the true incremental cost of manufacturing that next ton of product.
Lean accounting advocates point out that the columns of variances from standard costs, standard material usage, standard labor rates and the like that show up in traditional financial statements make them nearly impossible for most nonfinancial people to understand.
The Axim X30 Standard costs GBP161, the Axim X30 Wireless PAN/LAN 312MHz model is priced at GBP231 and the Axim X30 Wireless PAN/LAN 624MHz version with double processor speed costs GBP278.
118], with the accounting firm of Cooley & Marvin, summed up the prewar milieu in flowery fashion: "Not many years ago the advocates of standard costs were like voices crying in the wilderness.

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