BUS 254 Lecture 3: BUS 254 (3)
ellanda11 and 39647 others unlocked
3
BUS 254 Full Course Notes
Verified Note
3 documents
Document Summary
Standard dm p per unit: dm sq = quantity of dm that should be used per unit of fin g, expressed as a physical measure, e. g. kg, liters, barrels. In setting the standard, management should consider the quality & quantity of dm required to manufacture the product: should include allowances for unavoidable waste, normal spoilage, general format, required mat. Standard dm q per unit: standard dm cost per unit = dm sp * dm sq. Includes employer payroll taxes & benefits, like paid holidays & vacations: general format, hourly wage rate. Standard dl per unit: standard dl cost per unit = dl sp * dl sq. Total: standard moh rate per unit: pohr * activity index quantity standard. Total standard cost per unit: sum of standard costs of dm, dl, moh, general format: Vp purchasing can use a report to evaluate effectiveness of purchasing dpt manager: top management usually looks for significant variances (e. g. 10% different than standard)