budget and standard costs

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
can anone please help i am really struggling to know the difference between the budget and standard costs for unit 8, i know you get given one set of costs then it some times asks you for the either budget or standard, i am just really confussed with htis part if someone can tell me and easy way i can sort this out in my head i would be so gratefull.<BR>Thanks<BR>Jacky<BR><BR>E-Mail address is jaqui51724@aol.com

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    budget and standard costs

    I found this difficult to get my head around. It is my understanding that the standard costs and quantity's are the budgeted cost for the actual amount of production.<BR><BR>I.e. If your budgeted cost for material was £20,000 and your budgeted amount of units was 5,000, yet you actually made 10,000 units the calculation would be as follows:<BR><BR>£20,000/5,000 units x 10,000 units = £40,000<BR><BR>I hope this helps.<BR><BR>The budgeted is what it would cost to make the budgeted amount of units. in the case above for material £20,000.<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    budget and standard costs

    standard = budget. If you se budget, think standard and vice versa, they are the same.

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