tailieunhanh - Lecture Accounting principles (8E): Chapter 25 - Coby Harmon

After completing this chapter you should be able to: Distinguish between a standard and a budget, identify the advantages of standard costs, describe how companies set standards, state the formulas for determining direct materials and direct labor variances,.and other contents. | CHAPTER 25 Standard Costs and Balanced Scorecard Accounting Principles, Eighth Edition Distinguish between a standard and a budget. Identify the advantages of standard costs. Describe how companies set standards. State the formulas for determining direct materials and direct labor variances. State the formulas for determining manufacturing overhead variances. Discuss the reporting of variances. Prepare an income statement for management under a standard costing system. Describe the balanced scorecard approach to performance evaluation. Study Objectives 1. On the topic, “Challenges Facing Financial Accounting,” what did the AICPA Special Committee on Financial Reporting suggest should be included in future financial statements? Non-financial Measurements (customer satisfaction indexes, backlog information, and reject rates on goods purchases). Forward-looking Information Soft Assets (a company’s know-how, market dominance, marketing setup, well-trained employees, and brand image). Timeliness (no real time financial information) The Need for Standards Standards vs. budgets Why standard costs? Setting Standard Costs Analyzing and Reporting Variances from Standards Balanced Scorecard Financial perspective Customer perspective Internal process perspective Learning and growth perspective Direct materials variances Direct labor variances Manufacturing overhead variances Reporting variances Statement presentation Ideal vs. normal Case study Standard Costs and Balanced Scorecard Service Cost - Actuaries compute service cost as the present value of the new benefits earned by employees during the year. Future salary levels considered in calculation. Interest on Liability - Interest accrues each year on the PBO just as it does on any discounted debt. Actual Return on Plan Assets - Increase in pension funds from interest, dividends, and realized and unrealized changes in the fair market value of the plan assets. Amortization of Unrecognized Prior Service Cost - The cost of . | CHAPTER 25 Standard Costs and Balanced Scorecard Accounting Principles, Eighth Edition Distinguish between a standard and a budget. Identify the advantages of standard costs. Describe how companies set standards. State the formulas for determining direct materials and direct labor variances. State the formulas for determining manufacturing overhead variances. Discuss the reporting of variances. Prepare an income statement for management under a standard costing system. Describe the balanced scorecard approach to performance evaluation. Study Objectives 1. On the topic, “Challenges Facing Financial Accounting,” what did the AICPA Special Committee on Financial Reporting suggest should be included in future financial statements? Non-financial Measurements (customer satisfaction indexes, backlog information, and reject rates on goods purchases). Forward-looking Information Soft Assets (a company’s know-how, market dominance, marketing setup, well-trained employees, and brand image). .