Syllabus A1cd

A1c - Apply standard costing methods including the reconciliation of budgeted and actual profit margins, distinguishing between planning and operational variances
- Manufacturing standards for material, labour, variable overhead and fixed overhead.
- Standards and variances in service industries, public services (e.g. health and law enforcement), and the professions (e.g. labour mix variances in consultancies).
- Price/rate and usage/efficiency variances for materials, labour and variable overhead.
- Subdivision of total usage/efficiency variances into mix and yield variances.
Note: The calculation of mix variances on both individual and average valuation bases is required.
- Fixed overhead expenditure and volume variances.
- Subdivision of the fixed overhead volume variance into capacity and efficiency variances.
- Sales price and sales volume variances (calculation of the latter on a unit basis related to revenue, gross profit and contribution).
- Sales mix and sales quantity variances. Application of these variances to all sectors including professional services and retail.
- Planning and operational variances.
- Variance analysis in an activity-based costing system.

A1d - Interpret material, labour, variable overhead, fixed overhead and sales variances
- Interpretation of variances
- The interrelationship between variances.