Standard Cost Card
It is a card record of the Standard or expected costs in producing a specified output. This gives the physical quantities of inputs and also their monetary values. This gives also the quality required. As an example: Grade a labour.
The setting process of standards results in the establishment of the standard cost for the product. The make-up of the standard cost is recorded on a standard cost card. As an example: a standard cost card in a company's X004 product would look given as:
Assuming the given product details as:
1. The product passes via department A, B, and C
2. It consume the following two types of direct materials as:
P10: 2.5 kg (kilo-gram) each @ Shs.14.8: it is applied in department A
A53: 1000 units @ shs.3.75 per 100 units: It is applied in department B.
3. X004 also used direct labour given as:
Grade M: 4.8 hours @ Shs.2.5/hr in Department A
Grade N: 9.2 hours @ Shs.2.5/hr in Department B.
Grade O: (Assembly time): 16.4 hours @ Shs.1.75/hr in Department C.
4. Production overheads are applied given as:
Machine overheads: based on direct labour hours. They are incurred like shs.11/hr in departments A and B.
Indirect labour: based on direct labour hours in Department C above at shs.6/hr.
Required
Prepare or get ready a standard cost card for product X004.
Solution:
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Standard Cost Card For Product X004
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Revised: 31.12.2004 By: Aron
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Cost Type and Quantity
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Standard Rate (shs)
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Department A (shs)
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Department B (shs)
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Department C (shs)
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Total (shs)
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Direct Material
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2.5kg of P10
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14.8
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37
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-
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-
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37.00
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1000 units of A53
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3.75 per
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-
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37.5
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-
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37.50
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100 units
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74.50
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Direct Labour
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Grade M: 4.8hrs
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2.5
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12
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-
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-
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12.00
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Grade N: 9.2hrs
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2.5
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-
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23
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-
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23.00
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Grade O: 16.4 hrs
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1.75
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-
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1
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28.70
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28.70
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63.70
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Production Overheads
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Machining:
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11
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58.20
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101.12
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-
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153.92
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Indirect Labour
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6
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-
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-
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98.4
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98.4
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-
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101.80
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161.62
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127.10
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252.32
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Standard Cost Summary:
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Shs.
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Direct Materials:
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74.50
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Direct Labour
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63.70
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Production Overheads
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252.32
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Standard cost per unit
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390.52
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