In chapter 4 I discussed some of the problems of using standard costs in practice and showed how the costologist has developed an over-sophisticated approach to the difficulties. Yet in spite of the problems and the complications of variance analysis, many companies use standard costs. There are many more that, while not exactly using standard costs, are using standards as a basis for control. There must then be some value in using the standard cost approach. I shall endeavour in this chapter to pinpoint the values so that we might obtain the benefits without the disadvantages.
KeywordsIncentive Scheme Cost Control Contribution Variance Standard Cost Meaningful Standard
Unable to display preview. Download preview PDF.
- 1.For further information on variance accounting refer to Laidler E., Variance Accounting, Macmillan and the ICMA, 1976.Google Scholar