Nassar Pte Ltd. incurred the following costs in Q4: Direct Materials: $101,200 Manufacturing Overhead: $51,300 Direct Labor: $97,500 Selling Expenses: $34,700 Indirect Labor: $42,600 Conversion costs were:
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Nassar Pte Ltd. incurred the following costs in Q4:
- Direct Materials: $101,200
- Manufacturing
Overhead : $51,300 - Direct Labor: $97,500
- Selling Expenses: $34,700
- Indirect Labor: $42,600
Conversion costs were:
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