Analysis of deviations from normative (standard costs). Accounting for material costs and control over their distribution The deviation in the report on the use of materials is calculated

Variable cost variances = VPV = SIZ-PPZ, where SIZ is the related overhead costs for the fact t of the OPR labor. FPP - actual variable costs. Analysis of deviations is carried out item by item.

The main reasons for deviations:

1) Deviations due to the work of auxiliary workers

2) Deviations for indirect material costs

3) Deviations in energy consumption

4) Maintenance deviations

Deviations in the efficiency of variable costs = OEPR = (MCh-FCh) * NF, where MCh is the standard time in hours spent on the actual output of products. FC - the actual time in hours worked for the period. NF - standard hourly overhead rate.

Fixed cost variances.

ERP = ERC - ERC, where ERC - estimated fixed overhead costs, ERC - actual fixed overhead costs. The analysis is carried out item by item in the context of cost centers.

Reasons for rejection:

1) Changes in the wages of middle managers

2) Appointment of additional leaders

3) Changes in indirect material costs

4) Energy consumption deviation.

Analysis of revenue deviations by sales price, by sales volume

The most important aspect of cost management is matching

actual costs with standards. The difference between actual and

standard cost is called variance. Deviation calculate

separately for each cost accounting object: responsibility center, type

products, order, etc. The purpose of the analysis of deviations is to determine and detail

assessment of each cause, each factor that led to the occurrence

deviations, establishing responsibility for what happened. Contemporary

identification and analysis of the causes of deviations allows you to take timely

necessary measures to eliminate undesirable and strengthen favorable

trends.

Revenue variance:

1. At the price Δat the price = (C actual - C standard) * V actual.

2. In terms of sales volume ΔVreal = (Vact. - Vnorm.) * C standard

Management comments on budget variances.

Based on the calculation and analysis of deviations and their causes, the manager can make decisions to eliminate unwanted deviations and strengthen favorable trends.

For example, if the company's costs increased due to an increase in the price of

resources to be acquired, it is necessary to analyze the possibilities of transition to

less expensive materials, reducing consumption rates of expensive

materials, or perhaps just look for other suppliers offering

goods at lower prices.

If the reason for the increase in total costs was an increase in volume

production, caused by high market demand for the company's products,

most likely, we should try to stimulate further growth in volumes,

or if the production capacity or the risk of increased competition

do not allow this to be done, to raise prices for products, thereby increasing

enterprise profit.

DEFINITIONS

Variance Analysis(Variance Analysis) - the process of identifying the magnitude and causes of deviations of actual indicators from the budget.

Analysis "Cost - Volume - Profit"(Cost - Volume - Profit Analysis) - operational analysis used in cost and profit planning.

Budget(Budget) - budget (estimate); quantitative and cost expression of the plan for the coming period (usually a year).

Business expenses budget Selling Expenses Budget).

Sales budget(Sales Budget) - the budget (estimate) of sales in natural and cost units. Starting point for budgeting.

direct labor budget(Labor Budget) - the budget (estimate) of labor costs in the scheduled period.

Overhead budget(Factory Overhead Budget) - contains overhead costs collected for all divisions for the purpose of subsequent control and calculation of the standard ODA rate for distribution to costing objects.

Budget for general and administrative expenses(General and Administrative Expense Budget) - a detailed plan of general expenses.

Gross margin ( Contribution Margin, Profit Margin) – marginal profit or the result of the excess of revenue over variable costs for the level of sales in the period under review.

Gross profit(Gross Income, Gross Profit) - the difference between net revenue (net) and the cost of goods sold, products, works and services.

Flexible budget(Flexible Budget) - a budget (estimate) developed for different levels of sales (business activity). planning tool and operational control fulfillment of the intended.

Master or static budget(Master Budget) - the overall budget (estimate), consisting of operating and financial budgets.

Direct costing(Direct Costing, Variable Costing) - a system for accounting and calculating the unit cost of production based on variable costs.

Differential costs(Differential Costs) - incremental or decreasing costs for alternatives.

Stocks of finished goods(Finished Goods Inventory) - all production costs at the end of the reporting period, attributed to fully manufactured but not sold products.

Direct labor costs ( Direct Labor Costs are those that can be directly and economically attributed to the finished product.

Absorption calculation ( Absorption Costing) - a system for accounting for full costs in the cost of production; limited costing system, when only production costs (direct materials, direct labor and overhead costs) are allocated per unit of product.

Selling expenses(Selling Expenses) - the cost of selling and promoting a product on the market.

Conversion costs(Conversion Costs) - Added costs or processing costs, including direct labor and overhead costs.

Ending stocks of inventories(Ending Inventory) - stocks at the end of the reporting period.

Controlled costs(Controllable Costs) - costs that can be controlled and, accordingly, fall under the influence of the head of the responsibility center.

Indirect or indirect costs(Indirect Costs) - part of the costs, distributed artificially.

Indirect or indirect labor costs(Indirect Labor) - costs that relate to general production costs.

Indirect or indirect costs of materials (Indirect Materials) - costs that relate to general production costs.

LIFO method(Last-in, First-out Method, LIFO) - a method of accounting for costs in stocks at the prices of the last purchases included in the cost of goods sold, products, works and services. Reduces sales revenue.

FIFO Method(First-in, First-out Method, FIFO) - a cost accounting method in which the cost of inventory is written off on products sold in the order in which they are acquired. Leads to overestimation of profit from sales; useful for accounting.

Normative amount of direct materials(Direct Materials Quantity Standard) - the standard amount of consumption of direct materials per unit of product.

Working hours(Direct Labor Time Standard) is the standard number of hours required to produce a unit or batch of a product.

Standard wage rate for direct labor(Direct Labor Rate Standard) - the normative (standard) cost of one hour of direct labor, scheduled in the planning period.

Standard price of direct materials ( Direct Materials Price Standard) - the projected unit cost of a particular type of materials in the budget.

overhead costs(Factory Overhead Costs, Manufacturing Overhead) - overhead costs (auxiliary materials, depreciation, labor costs for engineers, etc.).

Operating or Principal Activities(Operating Activities) - the main economic activity that generates net profit.

Operating profit or profit from main operations(Operating Profit, Income from Operations) - the difference between gross profit and operating (sales and management) expenses. It is not equivalent to the profit from sales of the Russian form No. 2, but can be conditionally taken as such.

Operating expenses(Operating Expenses) - expenses related to the main activity and including selling and administrative expenses.

Variance in overhead costs(Overhead Volume Variance) - the difference between the actual and standard (budget) ODA at the achieved level of production.

Deviation in the number of direct materials(Direct Materials Quantity Variance) - the difference between the actual used and the standard quantity, multiplied by the standard price of direct materials.

Price variance for direct materials(Direct Materials Price Variance) - the difference between the actual price and the standard price, multiplied by the amount of materials actually purchased.

Deviation in efficiency of using direct labor (Direct Labor Efficiency Variance) - the difference between actual and standard labor costs in hours, multiplied by the standard wage rate.

Profit Statement(Income Statement).

variable costs(Variable Costs) - costs that change in proportion to changes in sales volume or other level of activity.

Recurring costs(Period Costs, Period Expenses) - costs written off against revenue for the period (for the entire sales volume). Not allocated to a unit of production if limited cost is calculated. In the traditional format of the income statement, selling and administrative expenses are included.

Cost behavior(Cost Behavior) - change in costs in response to a change in sales volume or another level of activity (business activity).

Approach with cost averaging per unit of product in the process Average Costing Approach - Product costing is based on the assumption that units in opening inventory were started and completed during the current period.

fixed costs (Fixed Costs) - costs that do not change in the relevant range of sales of the period under consideration.

Fixed costs of production ( Fixed Manufacturing Costs - relate to production and do not change with the increase or decrease in the volume of activity.

Profit, income, revenue(Earnings) - for example, earnings before interest and taxes (Earnings before Interest and Taxes), earnings per share (Earnings per Share).

Incremental or incremental analysis (Incremental Analysis) - analysis of relevant information on deviations in alternatives.

Product cost(Product Cost) - costs attributed to a unit of product. Traditionally include direct materials, direct labor and overhead costs.

Direct costs(Direct Costs) - those that can be directly and economically attributed to a product or segment (for example, direct materials, direct labor). Not to be confused with variable costs!

Direct materials ( Direct Materials - basic materials, directly and economically assigned to a unit of product.

Cost allocation(Cost Allocation) - the assignment of certain costs, for example, overhead costs, to a product, cost objects.

Expenses(Expenses) - a decrease or other expenditure of assets or the appearance of liabilities. They arise as expenses of the accounting period in the course of operating activities. Differ from accidental losses (Losses) or extraordinary expenses (Extraordinary Items).

Relevant Information(Relevant Information) - relevant for making management decisions in a given situation and at a given time; anticipated future data that differ in the manager's alternative courses of action.

Relevant Range(Relevant Range) - the levels of business activity within which the cost formula works, that is, the assumption of the behavior of costs as variable and fixed is valid.

Cost of Goods Manufactured.

Cost of goods sold(Cost of Goods Sold) - the cost of goods sold, products, works and services.

An income statement item that includes manufacturing costs of products sold or u1079 purchase prices of products sold.

Costing system for orders (Job Order Cost System) - usually used in individual and small-scale production of products.

Mixed costs(Mixed Costs) - contain a variable and a fixed part of the costs (for example, electricity costs, telephone calls).

Standard costs(Standard Costs) - standard costs per unit of product. Used in the standard-cost system. They are subdivided into direct material costs, direct labor costs and overhead costs.

Price(Cost) - costs, costs, expenses; cost (initial, historical), prime cost.

Break even(Break-Even-Point) - the level of business activity at which revenue equals total costs. It can be calculated in natural and cost units.

Transfer price(Transfer Price) - the price at which products and services are transferred from one unit or segment to another.

Management expenses(Administrative Expenses) - administrative and general expenses related to the functioning of the business as a whole (administration salaries, office maintenance, etc.).

Management Accounting(Managerial Accounting) - the process of identifying, collecting, processing and providing analytical information on costs and results for decision-making by managers at all levels. Corporate strategy support system.

Conventional units(Equivalent Units) - conventional units as a measure of production for an accounting period of time used in process costing.

fiscal year(Fiscal Year) - The fiscal year, which may not be the same as the calendar year.

Revenue Center(Revenue center) - a center whose head is responsible for revenues and can control and influence prices and / or volume of activities.

Cost Center(Cost Center) is a segment (division) of an organization, a branch of activity for which it is advisable to take into account accumulated costs. A responsibility center in which the manager controls only costs.

Responsibility Center(Responsibility center) - an organizational unit, a segment, the head of which is responsible for costs (cost center), for revenues (revenue), costs and profits (profit center), costs, profits and investments (investment center).

profit center(Profit center) - a responsibility center, the head of which is responsible for costs and profits.

Net revenue (Sales, net) - net sales.

Similar information.

"Economic analysis: theory and practice", 2008, N 9

The main purpose of creating any organization is the production of products (performance of work, provision of services). To make optimal management and financial decisions, to successfully operate in the market, you need to know your costs and, first of all, understand information about production costs. Cost analysis helps to find out their effectiveness, to establish whether they will be excessive, to check the quality indicators of work, to set prices correctly, to regulate and control costs, to plan the level of profit and profitability of production.

As you know, the production process is a set of business operations associated with the creation of products. In the process of creating products, the actual cost is determined, including the amount of costs for its manufacture.

Calculating the cost of manufactured products is one of the main issues accounting. On the one hand, a reliable and detailed cost calculation is necessary for internal users of accounting information - administration, founders, owners. These data make it possible to determine how profitable a particular type of activity is in certain economic conditions, whether the existing system for organizing the production process is effective, what can and should be changed, in what direction to develop. On the other hand, the composition of the organization's production costs is one of the most important indicators necessary for the calculation and payment of mandatory tax payments, primarily income tax. Errors in costing can lead to serious tax consequences.

All costs for the production and sale of products are expressed using the cost of production. Therefore, one of the most important tasks of management accounting is the calculation of the cost of production, i.e. comparison of production costs with the amount of output.

Calculation of the cost of production can be carried out by various methods, i.e. There are several methods for analytical accounting of production costs for costing objects and methods for calculating costing units. The choice of any method is based on taking into account the characteristics of the production process, the nature of the product, its composition, and the method of processing.

Calculating the cost of production provides invaluable practical benefits and is an important aspect of the economic activity of the enterprise. And the choice of the most optimal methods of economic calculations simplifies the work of economists and makes it possible to conduct a clearer and more complete analysis of the effectiveness of the economic activity of the enterprise. All analytical methods used in the management accounting system in the management control (controlling) block, when evaluating planned (forecasted, standard) indicators, can be grouped into two large groups: universal and specific. Universal methods, as a rule, are used in other areas of knowledge: mathematics (index method, chain substitution method, etc.), statistics (extrapolation method, regression-correlation method), economic analysis (factorial, integral, complex assessment, etc.). etc.) and specific methods that are characteristic only for management accounting, for example, the well-known "standard-cost" method.

Cost accounting methods in the management accounting system can be grouped according to the following criteria: 1) the time of occurrence; 2) completeness of inclusion; 3) relation to the production process.

According to the first criterion, the methods of actual and standard (standard) costs are distinguished.

The method of accounting for standard costs involves the preliminary determination of standard costs for certain types of products, operations, processes and other objects with the allocation of deviations from standard costs during production.

The method of accounting for actual costs is a method of sequential accumulation of data on actually incurred costs without reflecting in the accounting data on their value according to current standards.

Cost accounting methods in the second direction are divided into methods of full and partial cost. The full cost method provides for the calculation of the cost, which includes all the costs of the enterprise associated with the production and sale of products.

An alternative to this method is the approach when an incomplete, limited cost is taken into account. This cost may include only direct costs or only variables. It can also be calculated only on the basis of production costs, etc. In each case, the completeness of the inclusion of costs in the cost is different. However, this approach has in common that some types of costs related to the production and sale of products are not included in the cost of individual types of products, but are reimbursed by the total amount from the proceeds. This is the essence of the partial cost accounting method. Depending on the organization of production, the following methods are distinguished: order-by-order, by-process (by-process), which, in turn, is divided into semi-finished and non-semi-finished options.

With the order method, the object of accounting is the production order. This method is used in unit production enterprises.

With the progressive method, the object of cost accounting is the redistribution - the finished part of the technological process, which ends with the release of an intermediate product - a semi-finished product.

With the semi-finished version, the semi-finished product acts as a finished product intended for sale to a third party.

With the non-semi-finished option, the semi-finished product is not allocated to an independent accounting unit intended for sale. This method is typical for mass production, in which raw materials or materials are sequentially, step by step, converted into finished products.

Planning the requirements for materials solves two main tasks - determining the quantity and time of purchase of the necessary stocks. These decisions determine inventory holding costs and the costs associated with acquiring materials.

Determination of the quantity of materials needed for production begins with the preparation of a production estimate, which is based on the planned or expected sales volume for a certain period. Based on the production estimate, schedules for the need for materials are formed. If the production estimate prescribes the manufacture of a certain number of specific products, then the amount of materials required during the estimate period is determined as the product of the number of products and the quantity of materials determined by the specifications in one product. This calculation is also applicable to determine the need for materials for each week or for another, shorter period.

The production cycle of the product and its components directly affects the determination of the moment of delivery of a particular material. The production cycle is the period of time from the start of work with materials to the end of the production of a product from these materials. It should be borne in mind that some materials are needed immediately to start work on the order, while others may be required only after some time to complete the final operations.

Since absolutely accurate forecasts of material requirements are practically impossible, a company needs to have buffer stocks, which are "stocks that are maintained as an insurance reserve for uncertain demand or direction of use." The optimal size of the reserve stock will be such a quantity at which the costs of storage and additional costs associated with the acquisition of materials will be minimal.

The release of materials into production is carried out on the basis of limit or limit-fence cards. They take into account: the type of operation, the receiving workshop, the item number and the name of the supplied materials, the unit of measurement. Limit-fence cards are the primary documents for the release of materials into production. The limit of the monthly consumption of materials is calculated in accordance with the production plan for the month and the current consumption rates. Overspending or savings in materials are promptly identified and accounted for in the accounts.

The supply limit is subject to change. When changing the limit of issue of materials, a new one is issued instead of the old limit card.

The release into production of materials consumed occasionally is documented by the requirements-invoices approved by the head of the enterprise.

However, the release of materials into production does not yet mean their actual consumption. The actual consumption of materials is understood as their actual consumption in production for the manufacture of products, as well as for workshop and general plant needs.

Write-off of materials to cost accounting accounts is carried out on the basis of work sheets, which indicate the materials used in production. The shift supervisor is responsible for the use of materials in production and the preparation of relevant documentation.

The total actual material consumption for the reporting period is determined by the formula:

P \u003d O + P - B - O,
f np kp
where P is the actual consumption of material for the reporting period, rub.;
f
O - the balance of the material at the beginning of the reporting period, rub.;
np

P - documented receipt of material during the reporting period, rub.;

B - internal movement of material during the reporting period (return of material to the warehouse, transfer to other workshops, etc.), rub.;

O - the balance of material at the end of the reporting period, determined
kp
according to the inventory, rub.

The actual consumption for each product is determined by distributing it in proportion to the standard consumption.

The result of documenting the movement and the expenditure of basic materials and the calculations performed is the posting.

Let's consider the procedure for accounting for direct material costs using the example of Zenith LLC. The accounting policy provides for a custom-made calculation method.

Dr. c. 20 "Main production" Kt c. 10 "Materials".

On the basis of the studied data, on order N 115 for the manufacture of product "A", in December 2006, upon presentation of a request for the release of materials from the warehouse, basic materials in the amount of 20,236 rubles were released into production, including:

material N 1 - 3450 rubles;

material N 2 - 2737.02 rubles;

material N 3 - 6459.60 rubles;

material N 4 - 3850.70 rubles;

material N 5 - 38.67 rubles;

material N 6 - 54.34 rubles;

material N 7 - 4.12 rubles;

material N 8 - 3243.24 rubles;

material N 9 - 398.11 rubles,

which is reflected in the accounting records by the following entries: Dr. 20 "Main production"

Set of c. 10 "Materials" subac. 10.1 "Raw materials and materials" in the amount of 20,236 rubles.

Fuel and energy for technological purposes include electricity, water and other energy resources used directly for the implementation of technological operations. Process fuel and energy are included in the cost of a particular type of product based on primary documents or readings of measuring instruments (meters). If direct attribution is not possible, then fuel and energy costs are distributed indirectly in proportion to the number of hours of operation of the equipment, taking into account its capacity or energy consumption rates per unit of output. The reliability of determining the cost of process fuel depends primarily on how well the workplaces are equipped with measuring devices and how the primary accounting systems for energy consumption for process needs are built.

Accordingly, the grouping of costs by costing items for accounting for raw materials and materials involves the identification of waste material resources (returnable waste).

For the supply of materials, the organization concludes contracts with suppliers, which define the rights, obligations and responsibilities of the parties.

Control over the implementation of the logistics plan under the contracts, the timeliness of the receipt of materials is entrusted to the supply service. To this end, it maintains records of operational accounting for the implementation of supply contracts, in which they note the fulfillment of the terms of the supply contract for the range of materials, their quantity, price, shipping time, etc. Accounting department controls the organization of this accounting.

Material values ​​are accounted for in the appropriate units of measurement (weight, volume, linear, count). If materials are consumed in units different from those in which they were received, then they are taken into account simultaneously in two units of measure.

In the context of the analysis of deviations, it is necessary to distinguish between losses from the presence of waste and losses from marriage.

Production waste is considered to be materials that are consumed in the production process, but do not become part of the product. Waste may also include substandard or damaged materials that are not suitable for use in the manufacturing process. Waste expected in the production process (standard losses) is included in the standard cost of materials. If the amount of waste is greater than the standard value, then the excess (excess losses) is reflected as a deviation in the use of materials, along with the difference between the planned and actual values ​​of the amount of materials used.

Marriage is considered to be products and semi-finished products that do not meet the established standards or specifications in terms of quality and cannot be used for their intended purpose or are used after additional costs to eliminate existing defects.

As a rule, a certain level of marriage is always foreseen in advance and included in the estimate as part of the standard cost of production (standard losses), since the costs of completely eliminating the marriage may turn out to be unreasonably high. In addition to standard losses, the enterprise has excess losses or income. In this case, you can calculate the rejection deviation, which is the difference between the actual and standard number of defective products, multiplied by the standard cost of defective products.

For deviations in the amount of materials used, the head of the structural unit in which these deviations occur is responsible. Inclusion of this type of variance in the report of a specific department requires determining in which particular department the deviations in material consumption occurred. However, this approach requires rather laborious procedures for calculating stocks or flows of materials from one department to another, which is not always justified from the point of view of economic feasibility.

In order to improve cost accounting systems, Zenit LLC uses the "standard-cost" system.

"Standard-cost" - a normative method of accounting for costs and financial results. This method is based on the fact that cost and revenue accounting is carried out according to standard planned indicators, and deviations from planned norms are taken into account separately and written off at the end of the budget period to the corresponding stage. financial cycle, as a result of which the actual costs and financial results of the enterprise are established.

It should be noted that the planned indicators in the "standard-cost" system are recorded twice:

• for the first time before the start of the budget period in the planning documentation of management services;
• the second time during and after the end of the budget period on the fact of business transactions in the accounting of the enterprise.

This approach is not accidental, because it allows you to isolate deviations from the plan and the effect of deviations on the financial results of the enterprise in the context of individual stages of the financial cycle and individual financial transactions. The fact is that various types of deviations from planned indicators have a different effect on the activities of the enterprise, depending on the time of the business transaction and the stage of the financial cycle to which it relates.

There are the following types of standard costs:

• normative - they are calculated on the basis of ideal production conditions, excluding accidents, equipment shutdowns, disruptions in the supply of materials, insufficiently high qualifications of workers, and low quality of the resources used. Obviously, in practice, such standards can hardly serve as a guideline, but each manufacturer must strive to achieve them;
• basic - these standards are unchanged for a long time, do not change sharply with inflation, are revised with a radical improvement in the technological process;
• achievable (real) - are calculated, as a rule, for the conditions of a particular production and are the basis for calculating the cost estimate for production.

The use of the "standard-cost" system allows:

• draw up schemes for identifying those types of activities in which constant and significant deviations from the standards occur;
• calculate the forecast values ​​of future production costs that will be used in making management decisions;
• simplify the tasks of cost accounting and greatly reduce the time for accounting process.

The standard cost of producing a unit of output consists of the following elements:

• standard price per unit of materials;
• normative quantity (consumption rate) of the material;
• standard time (labor costs) per unit of output;
• standard wage rate.

Consider the use of elements of the system "standard-cost" on the example of OOO "Zenith". The enterprise, as noted in the accounting policy, uses the order-based costing method to calculate the cost of production.

To illustrate the standard-cost system, let's calculate the variances for direct material costs and direct labor costs.

Calculate the planned cost of production of product "A".

Initially, we determine the direct costs of raw materials and materials for this type of product.

For the manufacture of product "A" components such as materials N 1, 2, 3, 4, 5, 6, 7, 8, 9 are required. The standard consumption of materials per 100 kg of finished products is presented in table. one.

Table 1

Calculation of the cost of materials for the production of product "A"

Let's calculate the amount of materials needed for the production of a planned output of 1200 kg of finished products per month (Tables 2, 3).

table 2

Calculation of standard costs of raw materials

So, for the production of 1200 kg of product "A" per month, it is planned to consume materials in the amount of 21,428.02 rubles.

Now let's calculate the actual consumption of raw materials based on the actual output of products, which amounted to 1144 kg per month.

Table 3

Actual consumption of materials

For the production of 1144 kg of products, materials were used in the amount of 20,236.10 rubles.

Comparing the actual and planned costs of materials, we determine that the actual costs deviate from the standard ones. Let us analyze the reasons for these deviations.

Analysis of deviations of direct material costs

Actual material costs may differ from the normative ones for the following reasons:

• price deviations;
• deviations in the consumption of materials;
• the presence of a manufacturing defect and (or) replacement of materials.

Material price variances reflect the difference between the amount actually paid for a given quantity of material and the amount that was expected to be paid for the same quantity in accordance with established standards. Considering that one or another time may pass between the purchase of materials and their use in production, the question arises of choosing the moment for calculating deviations in the price of materials. It appears that settlement at the time of purchase is preferable to settlement at the point of use, since the sooner material price variances are known, the more likely appropriate corrective actions are to be taken. The value of deviations in the price of materials can be calculated as follows:

DELTACM = (Actual Price - Target Price) The actual quantity of purchased materials.

The calculation of deviations in the price of materials is presented in Table. four.

Table 4

Calculation of deviations in the cost of materials due to price changes

The total deviation in the price of materials is minus 59.94 rubles. (favorable). Price deviation for material N 8 RUB 36.61 is unfavorable because the material was purchased at a higher price than previously estimated. At the same time, the deviation in price for materials Nos. 1, 3, 4, 5, 6, 9, amounting to 96.55 rubles, is considered favorable due to the fact that the actual purchase price was lower than that included in the estimate. As a result, we get a favorable deviation in the price of materials of 59.94 rubles. (-96.55 + 36.61).

Favorable deviations in the price of materials occur when purchasing at a price below the standard. However, it should be noted that the purchase (for the sake of economy) of poor quality materials, while providing a favorable variance in price, may well lead to an unfavorable variance in the use of materials.

Unfavorable price variances for materials can occur due to inaccurate standard prices, overpriced purchase prices, inflationary price increases, purchase of materials of a different quality, excessive transportation costs, shortages of raw materials, etc. When detected variances in the price of materials regularly become unfavorable, this fact must be taken into account in cost-based pricing, as it is a signal that costs no longer reflect the current price level. At the same time, the analysis of deviations allows you to adjust prices to their actual level. For a more detailed analysis, it seems appropriate to subdivide the traditional material price variances into valuation variances and planning variances.

Valuation variances are calculated due to the fact that normal material price variances are quite acceptable for general cost control, but not very effective for estimating the performance of the purchasing department, since prices are formed mainly in the market, regardless of the authority of the head of this department.

Planning variances, also separated from the normal variance, are calculated by comparing the market and target prices. Such deviations are used to test forecasts and standards and help determine whether and, if so, to what extent, existing plans need to be adjusted in response to material price trends.

The second factor affecting the amount of material costs is the specific consumption of materials, i.e. their unit costs. Let's compare the standard consumption of materials with the actual one presented in Table. 5 and 6: according to the planned material costs, the standard consumption of materials for each type of material should have been:

Table 5

Planned consumption rate per 100 kg of finished products

Table 6

Actual consumption rate per 100 kg of finished product

Taking into account the fact that 1144 kg of products were actually produced, the standard consumption of materials for the manufacture of this quantity of the product is presented in Table. 7.

Table 7

Standard consumption of materials for the manufacture of the actual volume of products

Material consumption deviations reflect the extent to which the difference between the actual amount of basic production materials used and the standard amount intended to ensure the actual output of products affects the amount of direct material costs. Such deviations can be detected either when materials enter production or at the end of the production process.

At the time of calculating the deviations in the consumption of materials, the method of cost accounting and costing is significantly influenced. Since Zenit LLC uses an order-based accounting method, it is better to allocate quantity deviations when materials enter production, which occurs as needed and in accordance with the production schedule. To calculate deviations in the consumption of materials, it is necessary to eliminate the influence of the price factor, therefore such deviations are evaluated at the standard price.

DELTAI = (Actual amount of materials used -
M
Standard quantity of materials for the actual volume of production)
Standard price.

Deviations in the consumption of materials for the manufacture of 1144 kg of product "A" are presented in Table. eight.

Table 8

Deviations in the cost of materials due to changes in the volume of production and specific consumption of materials

The total deviation in material consumption was minus 132 rubles. - favorable deviation.

A favorable deviation is noted for the consumption of materials No. 2, 4, 8 in the amount of 186.07 rubles, since less material was actually released into production than planned due to changes in production volume and consumption rates. Favorable deviations in the consumption of materials can be associated with the use of materials of higher quality, when only a part of the required material is introduced into the production process for the manufacture of each unit of the final product, etc. At the same time, the result of the latter, if it is not caused by an improvement in the technological process, may be the release of products of inadequate quality.

For the use of materials N N 1, 3, 6, 9 deviation in the amount of 54.07 rubles. unfavorable due to its greater actual consumption. Unfavorable deviations in material consumption can be caused both by the use of inaccurate standards and differences in the moisture content of materials, and various inefficient actions, such as: insufficiently clear planning of the production process schedule; errors in setting up equipment; use of lower quality materials in order to save on price; irregular purchases; loss of materials on the production line; use of insufficiently skilled labor; non-return to the warehouse of unused materials, etc. The cumulative deviation for materials is the difference between the actual costs of the material and the standard costs, taking into account the actual production output. Standard unit costs of materials are presented in table. 1. Taking into account the actual production volume of 1144 kg, the total amount of standard costs is presented in Table. 9.

Table 9

The actual costs of materials are presented in table. 3, therefore, the cumulative deviation for the materials is (Table 10).

Table 10

Cumulative Material Variance

The total deviation for material costs amounted to minus 191.94 rubles.

It develops under the influence of two factors:

price deviation equal to 59.94 rubles;

deviation in the use of materials, equal to 132.00 rubles.

As can be seen, the overall material cost variance is favorable, the material consumption variance is favorable, and it is greater than the favorable price variance.

Literature

1. Voronova E.Yu. Order-based costing: material costs // Auditor. - 2002. - N 5. - S. 34 - 43.
2. Ermakova N.A. Classification of management accounting methods // Economic analysis: theory and practice. - 2004. - N 13 (28). - S. 52 - 55.

I.G. Kondratova

The Cost Variance assignment fields display the difference between the base cost and the total cost for a task, resource, or assignment. Total Cost - A current cost estimate based on actual and remaining costs.

There are several categories of Cost Variance fields.

Data type: monetary

Cost variance (task field)

Record Type Computed

Calculation method.

Usage. Add a Cost Variance field to a task sheet to compare the cost level with the task's budget. During the course of the project, this field is used to estimate the budget execution for the current date. At the end of a project, this field is used for cost analysis and planning for future projects.

Example. The base cost of the task is 5,000 rubles, since initially, according to a preliminary calculation, it takes 10 hours of work for a resource costing 50 rubles per hour to complete the task. If the resource only takes 5 hours to complete the task, the base cost is updated to $2,500. The cost variance is -2,500 rubles, indicating that the budget exceeds costs by 2,500 rubles.

Notes. If the cost variance is negative, the cost for the task is currently less than the amount specified in the budget or baseline. If the cost variance is positive, the cost is over budget. After the task is completed, this field displays the difference between the base and actual costs.

Cost variance (resource field)

Record Type Computed

Calculation method. Microsoft Office Project 2003 calculates cost variance as follows:

Cost Variance = Costs - Base Costs

Usage. Add a Cost Variance field to the resource view to determine the level of costs compared to the task's budget. During the project, this field is used to control the execution of the budget for the current date. At the end of a project, the field is used for cost analysis and planning for future projects.

Example. The base cost for the resource is $5,000, and the cost (total cost) is $4,500. The deviation in cost is - 500 rubles, that is, the budget is not exceeded.

Notes. If the cost variance is negative, the cost for the resource is currently less than the amount specified in the budget or baseline. If the cost variance is positive, the cost for the resource is over budget.

Cost variance (target field)

Record Type Computed

Calculation method. Microsoft Office Project 2003 calculates cost variance as follows:

Cost Variance = Costs - Base Costs

Usage. Add the Cost Variance field to the sheet area of ​​the Task Usage or Resource Usage view to determine whether the costs are within, over or under the assignment's budget. During the project, this field is used to control the execution of the budget for the current date. At the end of a project, it can be used for cost analysis and planning for future projects.

Example. If the base cost for an assignment is $5,000 and the cost (total cost) is $4,000, then the cost variance is -$1,000, meaning the cost for the assignment is less than the budget cost by $1,000.

Notes. If the cost variance is negative, the assignment's current cost is less than the amount specified in the budget or baseline. If the cost variance is positive, the cost is over budget. After the assignment is completed, this field contains the difference between the baseline and actual costs.

The analysis of actual results achieved can be carried out by comparing actual and budgetary or normative data. Since budgetary cost data are generally less accurate than standard costs, we will use standard costs to evaluate performance in what follows.

The first step in evaluating an organization's performance is to identify deviations which helps to identify areas of effectiveness or inefficiency.

I. Based on materials
	For the price of materials used	(Standard unit price of material - actual price) X (quantity of purchased material)
	By the amount of materials used	(Normative amount of material per actual output - actual consumption of materials) X (standard price of materials)
	Cumulative material consumption variance	(Standard cost per unit of material - actual cost per unit of material) X (actual amount of materials used per output)
II. By labor
	By wage rates	(Standard hourly wage rate - actual hourly wage rate) X (actual hours worked)
	By labor productivity	(Standard time for actual output - actual hours worked) X (standard hourly wage rate)
	Cumulative labor variance	(Standard labor costs per unit of output - actual labor costs per unit of output) X (actual output)
III. Overhead costs
	For fixed overhead	(estimated unit fixed overhead rate - actual unit fixed overhead rate) X (actual output)
	For variable overhead	(estimated variable overhead rate per unit of output - actual variable overhead rate per unit of output) X (actual output)
IV. By gross profit
	At the selling price	(Standard unit price - actual unit price) X (actual sales volume)
	By sales volume	(Volume of estimated sales - volume of actual sales) X (normative profit per unit of output)
	Gross margin cumulative variance	Total standard profit - total actual profit

In addition to determining the amount of deviation, it is important to find out the reason for this deviation. Once the cause is known, the manager can take appropriate action to resolve the problem. The process of calculating amounts and determining the causes of deviations between actual and standard costs is called deviation analysis. If the actual costs are higher than the standard, such a deviation is considered unfavorable in otherwise the deviation will be favorable. Variance analysis can be used selectively. Many organizations are so large that it is simply impossible to cover all areas of activity in detail. The practice of studying only areas of unusual products or unusual outcomes is called deviation management. With this system, only deviations that exceed a certain limit, for example + 4%, which are set by management, are analyzed. Variances can be calculated for entire categories, such as the total cost of basic materials, for any groups within the categories, for each cost item.

All analytical deviations are divided into three types:

• 1. Deviations in the cost of basic materials.
• 2. Deviations of direct labor costs.

Direct labor cost variance-- this is the difference between the actual value of direct labor costs and their value in the flexible budget (the budget for the actual production volume). To calculate this deviation, you can write the following formula:

Total deviation of labor costs, den. units;

Actual output, units;

Normative specific direct labor costs, den. units;

Actual total variable labor costs, den. units

The total labor cost variance can be broken down into two components as follows:

Labor cost variance at the wage rate (rate variance) shows to what extent the deviation from the flexible budget depends on the difference between the actual and standard hourly wage rates, and is calculated using the formula:

Deviation of labor costs at the rate, den. units;

Normative hourly rate of the main proizvodst-; military workers, den. units;

The actual hourly rate of the main production workers, den. units;

The actual number of hours worked by the main production workers, nat. units (h).

Favorable deviation at the rate of wages may be; nick for various reasons. For example, when using less skilled labor (paid at a lower rate compared to the standard one) or in the case when an overestimated rate was adopted as the standard one, taking into account the planned increase in wages. If such an increase was not made, or was made at a smaller rate than anticipated, the analysis would show a favorable rate variance.

Labor cost variance by hours worked (time variance) shows the extent to which the cumulative deviation in wages from the flexible budget depends on the difference between the actual and standard time in hours spent to produce the actual volume of output and is calculated by the formula:

Deviation of labor costs at the wage rate, den. units;

Standard number of hours worked;

Actual number of hours worked;

Standard hourly wage rate, den. units

Note that, just as in the case of a deviation in the price of direct materials, the formula contains precisely normative hourly rate. In the case of using the actual rate indicator, the calculation result would be "mixed" with an element related to the difference between the actual and standard hours worked, and thus would complicate the interpretation of the results.

Variable overhead cost variances

Cumulative variance of variable overheads from flexible budget is the difference between the actual value of variable overheads and their value in the flexible budget (budget for actual production). To calculate this deviation, you can write the following formula:

Full deviation of variable overhead costs, den. units;

Actual output, units;

Normative specific variable overhead costs, den. units;

Actual total variable overheads, den. units

Just as we did for direct variable costs, the total variance of overhead variable costs can be broken down into two components. At the same time, it should be remembered that the amount of specific overhead variable costs (per unit of output) is determined in proportion to the distribution rate calculated on some basis. Therefore, generally speaking, the deviation of overhead variable costs will be determined by two factors - the deviation of the indicator chosen as the basis of distribution (in our case, these are hours of direct labor), and the deviation of the volume of output. The factorization will be like this:

Allocation rate variable overhead variance shows the extent to which the cumulative deviation of variable overheads depends on the difference between the standard and actually produced products (to which overheads are allocated), and is calculated by the formula:

Deviation of variable overheads at the distribution rate, den. units;

Regulatory rate of distribution of overhead costs,

Actual variable overheads, den. units

Baseline variable overhead variance (efficiency variance) shows to what extent the deviation from the flexible budget depends on the difference; actual and standard values ​​of the base indicator: and is calculated by the formula:

Deviation of variable overheads by the base indicator (hours of direct labor) by production volume, den. units;

Actual labor costs of the main production workers, h;

Normative labor costs of the main production workers, h;

Normative rate of allocation of overhead costs.

Obviously, the calculation of this deviation is similar to the calculation deviations direct labor costs based on hours worked. The only difference is that instead of the standard cost of labor (hourly wage rate), the standard rate of distribution of variable overhead costs per 1 hour of labor is used.

In cases where variable overhead costs are distributed proportionally to the number of products produced, the base rate variance is zero, and the cumulative flex budget variance is equal to the overhead allocation rate variance.

Note that, just as for other types of deviations, in practice, deviations in the distribution rate and in the basic indicator of overhead costs may interact. In this example, variable overhead costs are distributed in proportion to the hours spent by the main production workers, so any factors that affect the amount of labor affect the variance of variable overhead costs. The mechanism of influence is the same as that of labor costs: wages at a rate below the budget rate can lead to an unfavorable variance of both labor costs themselves and variable overhead costs for the base indicator.

Fixed overhead variance

Fixed production overheads can be taken into account in two ways: by including them in the unit cost of production (calculation at full costs) and by attributing them to the costs of the period (when calculating at variable costs). Consider the fixed overhead variances for both costing options.

Overhead variance in variable costing

In a variable costing system, the interpretation of fixed overhead variances is not difficult: the variance is the simple difference between their budgeted and actual values, which coincides with the variance of overhead costs from the flexible budget and is calculated by the formula:

Fixed overhead variance in full costing

When using full costing (and most business entities use this method), the analysis of variances in fixed production overheads becomes more difficult, since they are fully included in the cost of production and are allocated to products sold and inventory balances. At the same time, the interpretation of deviations is largely determined by the chosen method of distribution of overhead costs.

The cumulative deviation of fixed overheads is the difference between the standard and actually absorbed values:

Total deviation of fixed overhead costs, den. units;

Actual fixed overhead costs, den. units;

Actual output, units;

Regulatory constant overhead costs per unit of output (specific); den. units

A favorable cumulative variance reveals excess absorption of overheads, while an unfavorable cumulative variance reveals a replacement deficit. Both arise from the discrepancy between the actual and budget values ​​of the costs themselves and output volumes.

The cumulative deviation can be broken down into its components as follows:

Here overhead allocation rate variance is calculated in the same way as for the case of variable costing, in which, however, neither the cumulative nor the volume variance is determined, since the distribution of fixed overheads is not assumed at all.

Actual fixed overhead costs, den. units;

Regulatory fixed overhead costs, den. units

Fixed overhead variance by volume shows the extent to which the cumulative deviation is determined by the discrepancy between the budgeted and actual volumes of output:

Deviation at the rate of distribution of fixed overhead costs, den. units;

Actual output, units;

Normative issue, units;

Regulatory constants of general production invoices costs per unit of output (specific), den. units

The analysis and interpretation of fixed overhead variances, as is clear from these considerations, is rather confusing and not always obvious. In most cases, identifying the aggregate variances for individual overhead items is more useful than separating them into rate variances and volume variances. There are, however, several categories of organizations for which volume variance analysis is particularly useful. First of all, these are organizations that make large investments in research and technological development, which involve high fixed overhead costs if they cannot be capitalized. To ensure the continued profitability of such organizations, it is necessary that current sales allow covering fixed overhead costs - volume deviations provide valuable information for making management decisions related to ensuring resource efficiency and financial performance.

Detailing the deviations of fixed overheads can also be useful in organizations of capital-intensive industries that have a large share of fixed assets. In such organizations, in the analysis, the "volumetric" component of the fixed overhead variance can, in turn, be broken down into a variance in terms of labor efficiency and deviation on the efficiency of production capacity. The first reflects the discrepancy between the planned and actual outputs associated with labor productivity, and the second reflects the impact on the volume of output of other factors (for example, unforeseen equipment downtime).

Deviations of commercial and management costs

Selling and administrative cost variances are calculated in the same way as overhead variances. If the expense categories we are considering are somehow charged to the cost of production (for example, for pricing purposes), the analysis of variances will be similar to the analysis of ODA variances carried out for the full costing case. However, in the overwhelming majority of cases, non-production costs are not included in the cost of production in any way, and therefore usually only their full deviations from the flexible budget are calculated in practice.

The composition of these categories of expenses includes many different components, so the analysis of deviations not in general, but for individual items, will be of the greatest value. The general formula for calculating variances in selling and administrative expenses is:

Deviation of administrative or commercial overhead costs, den. units;

The actual amount of administrative or commercial expenses, den. units;

Planned (budget) value of administrative or commercial expenses, den. units

For the variable components of administrative and selling expenses, the variance is calculated in the same way as the cumulative variances of variable costs for materials or labor:

Deviation of variable administrative or commercial expenses, den. units;

Actual variable administrative or commercial expenses, den. units;

Actual output or sales volume, units;

Regulatory variables administrative or commercial costs per unit of output (specific), den. units

Favorable selling cost variance is not always a positive factor, since there is almost always a trade-off between selling costs and sales volume: a reduction in selling costs can lead to lower sales volumes. A seemingly favorable deviation of variable commercial costs also means, first of all, that the sales volume of this period is significantly lower than either planned or production volume - neither of which indicates the successful operation of the organization.