Questions:
1. What is a standard cost card? What information does it contain? How does it relate to a bill of materials and an operations flow document?
2. How is the material standard developed? Why are the quantities shown in the bill of materials not always the same quantities shown in the standard cost card?
3. A total variance can be calculated for each cost component of a product. Into what variances can this total be separated and to what does each relate? (Discuss separately for material and labor.)
4. What is meant by the term standard hours? Does the term refer to inputs or outputs?