COST ACCOUNTING AND CONTROL

CHAPTER I: Introduction to Cost Accounting and Cost Accounting Cycle

COST means the measurement in monetary terms, of the amount of resources used for the
purpose of production of goods and services.
 Cash or cash equivalent sacrificed for goods and services that are expected to bring
current or future benefit to the organization
 Amount of money involved in production, marketing, and distribution.

ACCOUNTING is the art of recording, classifying, and summarizing in a significant manner

and in terms of money, transaction and events which are part at least, of financial character
and interpreting the results thereof.
 Financial Accounting  Auditing
 Managerial Accounting  Taxation
 Cost Accounting

FINANCIAL ACCOUNTING COST ACCOUNTING MANAGERIAL

ACCOUNTING
 Recording of a  Process of analyzing,  Providing information
company’s recording, classifying, to managers for use in
transactions and summarizing and planning and
preparation of interpreting the details controlling operations
financial statements. of costs of materials, for decision making.
labor, and factory
overhead necessary
to produce and sell
the product.
 Provides historical,  Determination of the  Financial analysis,
monetary, and cost of every order, budgeting and
verifiable information job, contract, process forecasting, cost
to the company. or unit as may be analysis, evaluation of
appropriate. business decisions,
etc…
 Used by external  Used by management  Prepares financial
users such as to control current reports for internal
investors, operations and plan users (management).
stockholders, creditors for the future.
for decision making
 purposes.

Cost Accounting as an Intersection between Financial Accounting and Managerial

Accounting
 Provides information regarding cost of products and services
 Provides cost data accumulated by the company, classified, summarized interpreted
and presented in ways that are useful for decision making.
 Adds to the effectiveness of financial accounting by providing relevant information which
ultimately results in better decision-making process of the company.
 Guide the management in determining the selling prices of the products
 Helps in measuring production efficiency
 Used in preparation of budgets and cost control and cost reduction by setting standards.

Cost Accounting System

 Used to track and allocate costs and expenditures. It provides management needed
information to estimate the cost of their products for profitability analysis, inventory
valuation and cost control. A well-defined cost accounting system will:

1. Provide means for proper valuation of inventories.

2. Help to control and management the cost properly.
3. Help measure the efficiency of men, machine, and usage of materials.
4. Provide data for pricing decision.
5. Help to identify wastes to reduce cost reduction.
6. Provide information as a basis for the preparation of financial statements.
FIVE PARTS OF A COST ACCOUNTING SYSTEM
1. INPUT MEASUREMENT BASIS (System of Accumulating Costs)
 Nature or type of costs, which flows into and through the inventory accounts.
Historical Costing Standard Costing Normal Costing
total product costs are all product costs are Combination of actual
known as the operation determined in advance. and standard costing.
has been completed. The difference between
actual and standard
cost are charged to
variance account
Direct Material Actual Cost Standard Cost Actual Cost
Direct Labor Actual Cost Standard Cost Actual Cost
F. Overhead Actual Cost Standard Cost Standard Cost

2. INVENTORY VALUATION METHODS

 Throughput Direct Full Activity Based
Costing (Variable Absorption Costing
Costing) Costing
Direct Material Inventory Inventory Inventory Activity Cost
Pools
Direct Labor Expense (sold) Inventory Inventory Activity Cost
Pools
F. Overhead Expense (sold) Variable: Inventory Activity Cost
Inventory Pools
Fixed:
Expense (sold)

3. COST ACCUMULATION METHODS

a. Job Order Costing
 Heterogenous products.
 Keeps the cost of different jobs, orders, contracts separate during manufacture.
b. Process Costing
 Homogenous products
 Units are not separately distinguishable from one another during manufacturing
process.
c. Backflush Costing
 Just in Time (JIT) inventory system
 Delays the costing process until the production of goods is actually produced or
completed.
d. Hybrid Costing
 Combination of job order and process
 Direct Materials: Job Order; Conversion Cost (DL & OH): Process

4. CASH FLOW ASSUMPTION

a. Specific Identification
 Actual cost is charged as COGS
 Cost of Inventory = Inventory Units x Unit cost
b. FIFO
 Goods first purchased, first sold
 Inventory cost = Recent and new prices
 Inventory sold = Older prices
c. LIFO
 Goods last purchase, first sold
 Inventory = older prices; COGS = recent prices
d. Weighted Average
 Beginning inventory are combined together with newly purchase inventories
 Average cost per unit = COGAS / no. of units purchased
  Then multiplied to units sold to determine COGS and unit on hand for
ending inventory.

5. RECORDING INTERVAL CAPABILITY

Perpetual Periodic
 Require stock cards that updates the  Requires a physical counting of
inventory accounts after each inventories on hand at the end of the
purchase of sale of the company. accounting period.

 Computer based inventory and bin  Generally used by retailers whose

location inventory items have small peso
investment.


COST ACCOUNTING CLASSIFICATION AND ESTIMATION

2.1 Know the different elements of costs
ELEMENTS OF COST
1. Material
 Includes cost of procurement, freight in, taxes and duties, insurance, etc.
 Directly attributable to the acquisition of materials
 The rebates (trade discount, refunds, returns, VAT) are DEDUCTED
2. Labor
 Converts raw materials into finished goods/products.
 Includes wages , salaries, allowances, production incentives or bonus, overtime pay,
holiday pay, and fringe benefits paid to employees.
3. Expenses ‘
 Costs incurred other than materials and labor.
 Direct Expenses: directly allocated to a particular product
 Indirect Expenses: cannot be conveniently or directly allocated to a particular product.

2.2 Distinguish the direct materials, direct labor and factory overhead costs
BASIS DIRECT COST INDIRECT COST
Meaning Easily attributable/traceable to a Cannot be easily assigned or
cost object traced to a particular cost object
Benefits Single Multiple
Aggregate Total of all direct cost (prime cost) Total of indirect cost (factory
overhead)
Traceable Yes No
OVERHEAD
total amount of indirect materials costs; indirect labor costs and indirect expenses. Costs which
cannot be associated directly with specific products and it is allocated or apportioned to
products/services on some rational basis.
Types of Overhead: Factory Overhead, Administrative Overhead, and Selling and distribution
Overhead
Factory Overhead
 Indirect cost incurred in the factory such as indirect materials and labor, factory
supplies, depreciation expense of the factory PPE, factory insurance, factory rent, etc.

2.3 Differentiate product cost vs period cost

PRODUCT COST PERIOD COST
Meaning  Cost of DM, DL, and FOH  Cost NOT associated with
used in manufacturing of production
products
Treatment  ASSETS  EXPENSE
1. Direct Cost 1. Selling and Marketing Costs
DM and DL 2. Administrative / General
2. Indirect Cost Costs
FOH
Note: Product and Period Costs may be fixed, variable, and mixed costs.

2.4 Learn relevant cost, opportunity cost, and sunk cost

RELEVANT COST
 Future costs that differ across the alternatives
 Helps the manager in taking a right decision in furtherance of the company’s objectives
 Affect the decision making of the management
OPPORTUNITY COSTS
 The benefit given up when one alternative is chosen over another. ‘
 Measured in terms of revenue which would have been earned by choosing the goods or
service in some other alternative uses.
 NOT recorded in the books of accounts of the company.
SUNK COST
  Cost for which an outlay has already been made and it cannot be charged by present or
future decision
 Historical cost and IRRELEVANT in the decision-making process
 Results of the past decisions and cannot be change any future decisions

2.5 Know the different cost estimation analysis

OBJECTIVE OF ESTIMATION
 Estimate the amount of fixed and variable costs and to identify the linear cost function
equation (y = a + bx) means:

Total mixed cost = Total fixed cost + (Variable cost x Number of Units)

1. High – Low Points Method

The quick and easy method that uses historical data from several reporting periods to estimate
the variable cost per unit and total amount of fixed cost that are part of mixed cost.
 Computed from two sampled data points – the highest and the lowest points based on
activity or cost drivers.
Advantage: Simple, inexpensive and easy to apply
Disadvantage: Use only 2 data points which may not produce accurate result
1. Identify the high and low activity levels from the data self:
Total amount of mixed costs occurring (level of production) at the HIGHEST and
LOWEST of ACTIVITY
Note: this method uses high and low activity and NOT peso amounts
2. Calculate the variable cost per unit
Variable cost per unit (b) = Change in Costs (highest – lowest)
Change in activity (highest – lowest)
3. Calculate the total fixed cost. (

Fixed Cost = Highest Activity Cost – (Variable Cost per unit x Highest Activity Units)

or

Fixed Cost = Lowest Activity Cost – (Variable Cost per unit x Lowest activity units)

4. State the results in equation form y = a + bx

2. Scattergraph Method
A graphical technique of separating fixed and variable components of mixed cost. It considers
all data points. All observed data at various levels are plotted on a graph.
 Regression line is then fitted to the plotted point which used to estimate the total fixed
and variable cost per unit.
 The point where the line intercepts y-axis (total costs) represents the total estimated
fixed cost and the slope of the line is the average variable cost per unit.
Advantage Disadvantage
 Uses all observations of cost data  The fitting of the line to the graph is
subjective
 Relatively easy to understand and  Difficult to do if there are several
apply independent variables (cost drivers) to
be used
 It provides more accurate results than  Unable to give the exact extent of
high – low method correlation
 Outliers or values of extreme items
are easily seen and do not affect this
method

STEPS
1. Plot the data points for each period on a graph
2. Visually fit a line to the data points
3. Estimate the total fixed costs
4. Calculate the variable cost per unit
5. State the result in equation form y = a + bx

3. Least – Square Regression Method

A statistical technique that investigates the association between dependent (the cost) and
independent variables (the activity). It uses all data points and mathematical equations to find
the best possible fit of the line to the data points.
 Provides more accurate results that scattergraph method
 Determines the line of best fit for a set of observations by minimizing the sum of the
squared deviation between cost line and the data points.
Simple Regression - 1 dependent variable: 1 independent variable
Multiple Regression – 1 dependent variable: Multiple independent variable
Formula:
 (1) ∑y = na + b∑x
(2) ∑xy = a∑x +b∑x²

Advantage Disadvantage
 Uses all observation of cost data  It requires relatively strict assumptions
for the results to be valid
 Relatively easy to use with computer  If an outlier is present this can
and calculators adversely affect the results

STEPS
I. Compute the mean in of the x values, the mean of the y values, the mean of xy values
and the mean of x²
II. Supply the values in the formula and compute the value of variable cost per unit
III. Compute the value of y-intercept (total fixed cost)
IV. State the result in equation form y = a + bx

4. Account Analysis Method

The identification of each cost as fixed and variable depends on the relationship between the
cost and the activity.
 The mixed costs are broken down into their variable and mixed components
 It estimates the total fixed cost by accumulating all cost identified as fixed
 To determine variable cost per unit, all variable cost are summed up and divided by the
number or activities.
Advantage Disadvantage
 It provides detailed expert  Subjective, judgmental approach
analysis of the cost behavior  The different analyst may derive different
each account estimates of cost behavior
 It is more labor intensive and time consuming
than regression analysis
 The cost of data collection may surpass
benefit

5. Other cost estimation method

a. Engineering method
 Study of physical relation between input (M, L, OH) and each unit of output (FG) is
done. It uses cost and activity projections instead of historical costs. It estimates
indicate what and how much costs should be.
 Advantage Disadvantage
 It can be used to estimate cost of  It is quite expensive to use because
totally new activities because it does each activity is using expert engineers
not require data from prior activities in that are costly.
the organization
 It can detail each step required to  Are often based on optimal condition.
perform an operation (No error, machine breakdown)

It is not useful when physical relationship

between inputs and outputs is indirect
 It permits a comparison of other
centers in which similar operations are
performed and enables the company
to review its productivity and identify
strengths and weaknesses. It helps
managers to identify non-value added
activities

b. Conference Method
 Cost are classified based on opinions from various company departments such as
purchasing process engineering, manufacturing, employee relations and so on.
Advantage Disadvantage
Its credibility is gained through the pooling of Its accuracy (cost estimate) is dependent on
expert knowledge objectivity, care of the people providing the
information.

CHAPTER 3: Materials Procurement, Use and Control

3.1 Know the steps in materials procurement, use and control
1. Determines the cycle of operation to be performed and establish the materials needed for
each cycle. (Engineering and Planning Department)
2. Develop material requirement with the help of the production budget and master plan.
3. Prepare a purchase requisition form to inform the purchasing agent of the quantity, quality
of materials needed. (Production department)
4. Prepare a purchase order that will be sent to the vendor (supplier) for delivery of required
materials. (Purchasing department)
5. Once received, prepare a receiving report which inspect the materials if there are
damages/defects and eventually certifies the materials received. (Receiving department)
6. A material requisition form is issued to the material storekeeper to issue the materials to a
given person or department requesting it a specified time.
7. Material stock cards are maintained to record the receipt and issuance of each kind of
materials.
3.2 Familiar with source documents maintained by the companies
3.3 Know the different departments responsible in the procurement
PROCUREMENT – acquisition of goods and/or services at its BEST possible costs (minimized
cost), in the right quantity, at the right time, in the right place from the right source (supplier).
Procurement (Purchasing) Department
 Responsible for the purchase of materials and supplies.
 Headed by the Purchasing Manager (authority to purchase materials needed by the
different company’s department in correct quantities, quality standard at the proper time
and LOWEST possible price)
Source Documents
1. Purchase Various departments Sent to the
Requisition requesting the Purchasing
Form materials and department for
supplies execution

Other copy for

storeroom
2. Purchase Prepared by the Supplier/Vendor (to Agreed price,
Order authorized personnel place an order) specification, terms
in the purchasing and conditions of the
department Storeroom (to notify product of the goods
about the materials and at specified time
Signed by the requested) and place of delivery.
purchasing agent
Receiving
department (to notify
to accept materials
ordered)

Purchasing
department (for filing)
3. Receiving Prepared by the Maintained by the Purchase order
Report receiving clerk of the receiving department number, account
receiving department number to be
Inspection charged, name of
department (for vendor (supplier),
verification) details relating to
transportation, and
Accounting the quantity and type
department (for of goods received.
 recording and
posting)

Storeroom
4. Material Prepared by the Material storekeeper Basis in recording
Requisition Requesting the materials from
Form department, such as the material stock
production cards and the job
department and order cost sheet.
other department
heads
5. Bill of Production Storekeeper (keep List of materials
Materials managers track of inventory) needed to produce a
product.
6. Return Materials requisitioned that were not used in the production and are
Materials returned to the material storeroom staff.
Report
7. Debit or Credit Prepared when type, quantity, quality ordered differs from the goods
Memorandum shipped. An adjustment must be made to the supplier’s invoice

3.4 Determine order point

ORDER POINT
 Trigger the placement of a purchase order for additional units of materials.
 Addresses the problem on inventory planning with regards to the timing of when to
place an order.
 Helps the company to minimize the amount of investment in its material inventory.
Formula:
Order Point = (Usage x Lead Time) + Safety Stock
Usage – quantity of materials used each day.
Lead time – estimated time in days to place an order of materials up to its receipt.
Safety Stock – estimated quantity of materials maintained to avoid running out of stock in
unusual events.
Formula:
Safety Stock = (Maximum Daily Usage – average daily usage) x Lead time in DAYS

3.5 Determine the Economic Order Quantity (EOQ)

ECONOMIC ORDER QUANTITY (EOQ)
  Equation which determines the optimum purchase order of inventory at a MINIMIZED
total cost.
 Total ordering cost and total carrying cost are EQUAL
Ordering Cost – incurred in having additional inventory
Carrying Cost – incurred in maintaining the inventory
EOQ Formula:

EOQ =
√ 2 QO
C

CHAPTER 4: ACCOUNTING FOR LABOR

4.1 Know the classification of labor costs
DIRECT LABOR – directly engaged in the conversion process of raw materials to finished
goods. Charged to WIP account.
INDIRECT LABOR – supports the production process and which are NOT directly involved in
the conversion of raw materials into finished products. Charged to FOH Control account.
 Includes financial benefits (fringe) to motivate workers.

4.2 Know the different departments responsible for labor costs

DEPARMENTS RESPONSIBLE FOR LABOR COST CONTROL
DEPARTMENT
1. Personnel  Planning, recruitment, and firing of the labor force.
Department  Provides trainings and seminars and place people to the
job they’re suited.
 Carrying out labor policies
2. Engineering and  Maintaining control over working conditions and
Works Study production technique/plan and specification for each job,
Department process, and operations.
 Preparation of plan for each job and process, maintaining
efficient working condition, conducting time and motion
study, merit rating setting time wage system, and
conducting research work.
3. Time Keeping  Accumulation of the total hours worked spent by each
Department worker on a job, product, and processes.
 Two important activities: Timekeeping and Time
booking
4. Payroll  Computation of the total gross earnings, including the
 Department amount of the payroll deduction (WHT, SSS, PhilHealth,
PAG-IBIG)
 Preparation of payroll/wages of all workers and
maintaining the patrol records.
5. Cost Accounting  Collecting, classifying, and assigning all costs to jobs,
Department products, and processes.

4.3 Know the different methods of time keeping

TIMEKEEPING
 Accumulation of the total hours worked spent by each worker on a job, product, and
processes.
 Includes preparation of payroll, effective utilization of human resources, minimizing
labor costs, discipline in attendance and determining the ideal labor time and machine
time.
Methods:
1. Manual Method
a) Attendance Register Method – a log book or time register book is maintained by the
timekeeper. Workers are required to sign in when they get inside and sign out when
they depart from the factory.
b) Token or Disc Method – a token or disc is given to each worker bearing his/her
identification number. The timekeeper records the attendance on the basis of these
disc.
2. Mechanical Method
a. Time recording clocks – each worker is given a time card. They will insert the time
card whenever they enter or departs from the factory.
b. Dial Time Records – a machine is used known as Dial Time Recorder to register
automatically the time in and out of the workers.
c. Key Record System – each worker is given a key which represents worker’s
identification number. The time ticket and clock time are recorded on a sheet of paper.

4.4 Differentiate the types of wages plans

TYPES OF WAGES PLAN

1. Time Based Wage Plan – wages are determined on the basis of time worked spent by
workers irrespective of the quality of work done.
Formula: Wage = No. of Time worked x Rate per Hour
 Advantages Disadvantages
a. Simple and economical a. Workers are not time pressured
b. Give sense of security b. No additional incentive for workers to
c. Not done in a hurry achieve production efficiency
c. Decreases the morale of other
workers

2. Piece Based Wage Plan – wages are determined on the basis of output produced by the
workers without considering the time spent in performing the job.
Formula: Wage = Units Produced x Rate per unit
Advantages Disadvantages
a) Provides incentive to workers who a) Increase clerical costs because this
produce more. plan needs an up-to-date records of
b) Fair wage plan because efficient output produce by each worker.
workers are rewarded. b) Workers feel tired because they
exerted lots of efforts to produce and
earn more.
c) Quality may be sacrifice for quantity.

3. Modified Based Wage Plan – combination of time wage plan and piece wage plan. Each
worker is paid based on a minimum hourly rate regardless if an established quota of
production is not met. Bonus for additional piece of output if they exceeded.
4. Bonus or Incentive Schemes – given to workers to increase production.
a. Individual Incentive Plan
 Renumeration will be based on the performance of individual workers
b. Group Incentive Plan
 Based on productivity of the group or entire work force.

4.5 Know the accounting for overtime premium

CHARGED TO SPECIFIC JOBS

- work for rush orders and overtime is required, charged to WIP account.
Journal Entry: Work in Process xxx
Payroll xxx
CHARGED TO MANUFACTURING OVERHEAD CONTROL
  Job is a regular order and cannot be completed in regular working hours, charged to
FOH Control account.
Journal Entry: Work in Process xxx (regular salary)
Factory Overhead Control xxx (premium)
Payroll xxx

4.6 Know the different labor time losses

A. IDLE TIME
- workers spend their time without giving any production caused non-availability of materials,
inefficient supervision, machine breakdown, power interruption etc.
 Normal idle time – loss of time, cannot be avoided (lunch, merienda, etc.) Treated as
PRODUCTION COST.
 Abnormal idle time – loss of time due to abnormal reasons (power failure; avoidable
machine breakdown). Treated as LOSS or EXPENSE.
B. MACHINE SET-UP TIME
- time non-productive hours paid to workers while machines are being prepared for new jobs.
C. LABOR COST OF REWORKING DEFECTIVE UNITS
- additional labor cost paid to workers to correct defective unit of products which fail to pass the
quality control inspection.

CHAPTER 5: FACTORY OVERHEAD

5.1 Know the different types of factory overhead
A. Indirect Materials – materials not directly used for production.
B. Indirect Labor – labor cost of employees not directly associated with production.
C. Other Manufacturing Expenses – cost classified either as fixed, variable OH or mixed.

5.2 Know how to control factory overhead costs

A. Classification of factory Overhead According to Behavior
1) Variable Factory Overhead
- Changes in direct proportion to the level of production within the relevant range.
- The total cost of variable overhead VARIES in direct proportion to the level of
activity
- Per unit cost remain CONSTANT
 2) Fixed Factory Overhead
- FOH cost that do not change within the relevant range, regardless of the changes in
production activity
- Total Fixed cost remain CONSTANT but varies inversely proportional to the level of
production activity
3) Mixed Factory Overhead
- Both characteristics of Variable and Fixed

B. Budgeting Factory Overhead

1) Actual Costing – determined FOH as they occur simultaneously with the manufacturing
operation only if it has been COMPLETED.
2) Normal Costing system – accumulated FOH based on a predetermined overhead rate
and direct material and labor are accumulated on actual cost
Determination of FOH rates
1. Plant-wide or Blanket rate
- Uses a single overhead rate
- For companies that manufactures similar products
- Total amount of OH is too small
Determine the Factory OH based on:
 Direct Labor Costs
Estimated Factory OH cost
Formula: Predetermined OH rate =
Estimated DL cost
 Direct Labor Hours
Estimated FOH Costs
Formula: Predetermined OH rate =
total estimated DL Hours
 Machine Hours
Estimated FOH Costs
Formula: Predetermined OH rate =
Total estimated Machine Hours
 Direct Material Cost
Estimated FOH Costs
Formula: Predetermined OH rate =
Total Estimated DM Costs
 Physical Output/units produced
Estimated FOH Costs
Formula: Predetermined OH rate =
Estimated Units of Production
C. Comparison of Actual with Applied (Budgeted) FOH on Regular Basis
APPLIED FOH
WIP xxx
Applied Factory Overhead xxx
ACTUAL FOH
Factory overhead and control xxx
Various Factory Overhead accounts xxx

1. Over-applied FOH
- Applied FOH exceeds the Actual FOH
2. Under-applied FOH
- Applied FOH is less than Actual FOH
Disposition
1. IMMATERIAL (insignificant) – closed to COGS
Journal Entry:
Factory Overhead xxx COGS xxx
COGS xxx Factory Overhead xxx
(if overapplied) (if underapplied)

2. MATERIAL (significant) – closed to COGS, finished good and WIP

Journal Entry:
Factory Overhead xxx COGS xxx
COGS xxx Finished Goods xxx
Finished Goods xxx WIP xxx
WIP xxx Factory Overhead xxx
(if overapplied) (if underapplied)

5.3 Know the different types of production capacity

1. Theoretical (Maximum or Ideal)
- plant or department’s capability to produce without any interruptions.
- NO allowance for human and non-human errors
- Full Efficiency
 2. Practical
- Plant or department’s capability to produce with an allowance for internal factors.
- Less unavoidable operating interruption.
3. Expected (Budget)
- Level based on expected capacity utilization for the budget period
4. Normal
- Takes consideration the seasonal and cynical demand cycle of the product
- Estimated over the number of periods or seasons
- Practical capacity less loss of productive capacity due to external factors

5.4 Know how to apply the different service cost allocation methods
1. Direct Method
- allocate service department cost directly to the revenue-producing/operating areas without
recognition of service provided among the service departments
- Major disadvantage: less accurate
2. Step (Sequential Method)
- allocates service department costs to other service department and to operating departments
in a sequential manner.
- Major disadvantage: no costs are re-circulated back to the service department.
3. Algebraic (Reciprocal) Method
- recognizes the interrelationship among all departments

5.5 Know how to compute and account factory overhead variance

Uses Actual and Applied Factory overhead account to record variances in the book
Note: variances will not appear on the annual financial statement presented.

1. Spending variance
Formula:
Actual FOH
Fixed FOH xx
Variable FOH xx xx
Less: Budgeted Allowance based on Actual Hours
 Fixed FOG budget (nomal capacity x std. fixed rate) xx
Standard Variable FOH (Actual Hrs. x Std. Variable rate) xx xx
SPENDING VARIANCE xx

2. Idle Capacity (Volume) Variance

Formula:
Budgeted FOH based on Actual Hours
Fixed (normal capacity x std. fixed rate) xxx
Variable (actual hours x std. rate) xxx xxx
Applied FOH (actual hours x standard rate) xxx
IDLE CAPACITY xxx

Or

Normal Capacity (Budgeted hours) xxx

Actual Hours xxx
Difference xxx
Standard fixed rate xxx
IDLE CAPACITY VARIANCE xxx