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.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
References in periodicals archive ?
The WIP inventory account gets the standard costs for the actual units produced.
The total variance (budgeted or standard costs minus actual costs) includes two elements: the rate or price component and the quantity component.
Total material cost variance for ingredient A Standard cost: 9,000 units x 4kg x $25/kg $900,000 Actual cost: 35,000kg x $26/kg $910,000 Material cost variance $10,000 (A) Divided into material price variance...
As a result the company has now published their latest guide to Standard Costs, which is invaluable for any company involved in batch, production or prototyping.
She was inaugurating training workshop on PEC standard costs and control documents.
ArcelorMittal's goal with this new IT strategy is to reduce operating costs at its Bremen and Eisenhuttenstadt sites in order to continue to match the market's standard costs per metric ton of steel.
Made with hardy winter wheat from the southern steppes and the soft natural glacial water of Lake Ladoga, Russian Standard costs pounds 11.99 and is available in stores nationwide.
Tableau Standard costs $795, while Tableau Professional is $1,349.
A first-class open peak ticket to Paddington is now pounds 210 while a standard costs pounds 135.
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.
Standard costs for U16s and adults are pounds 4.50 and pounds 6.95 respectively.

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