Accounting For Managers - Cost Estimation And Control-Standard Costing And Variance Analysis
Standard Costing Vs. Budgetary Control
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Standard costing and budgetary control are control techniques adopted in a firm with specific objectives. Following points of differences between the two can be observed:
Standard
Costing Vs. Budgetary Control
Standard costing and budgetary control are control techniques adopted in a firm with specific objectives. Following points of differences between the two can be observed:
1. Standard costing is a long range control activity developed and adopted with focus on production. Budgetary control is an activity concerned with every functional area of the firms and functional budgets are prepared to control that function in a shorter term.
Standard costing and budgetary control are control techniques adopted in a firm with specific objectives. Following points of differences between the two can be observed:
1. Standard costing is a long range control activity developed and adopted with focus on production. Budgetary control is an activity concerned with every functional area of the firms and functional budgets are prepared to control that function in a shorter term.
2.
Standard costs are scientifically
predetermined. Budgetary control is concerned with the overall profitability
and financial position of the concern.
3.
Standard costing is concerned
with ascertainment and control of costs. Budgetary control is concerned with
the overall profitability and financial position of the concern.
4.
The emphasis of standard costing
is on what should be the cost whereas in budgetary control the emphasis is on
the level of costs not to be exceeded.
5.
Standards are determined for each
element of cost. Budgets are determined for a specified period.
6.
Standard cost is a projection of
cost accounts. Budget is a production of financial accounts.
7.
Standard costing is concerned
with the control of costs and is more intensive in scope. Budgetary control is
concerned with the operation of business as a whole and is more extensive.
Tags : Accounting For Managers - Cost Estimation And Control-Standard Costing And Variance Analysis
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