ACCOUNTING FOR COSTS

VC/unit = (TCH TCL STEPPED COST)/(TUH TUL)

Pie Chart Degree = (cost/TC)*360
TC of Holding = Avg. Inventory * Holding cost/unit
TC of Ordering = No. of orders * cost/order
Reorder level = Max. Usage * Max. Lead time
Max. Level = Reorder level + Reorder qty-(Min., Usage*Min. Lead time)
Min. Level = Reorder level (Avg. Usage * Avg. Lead time)
Idle time ratio = (Idle Hrs/Total Hrs) * 100%
Labour Turnover Rate = (Replacements/Avg. No. of Employees)*100%
OAR = Budgeted overheads/Budgeted hours
(UNDER)/OVER ABSORPTION = (Actual hours * Std. OAR/unit) Actual Overheads
MARGINAL COSTING
SP VC = Contribution FC = Profit
Marginal costing profit
+/(-)

Increase/(decrease) in inventory level * STD. OAR/unit

Absorption Costing Profit

Process Costing
Cost/unit = (Material cost + Conversion Cost Scrap of Normal loss)/Expected output
Equivalent units of O/P WIP: FIFO- % to complete; WAC 100%
O/P+Input-C/S = Total Output
Units started and completed this period = INPUT C/S
Physical distribution = (Xs units/ Total units)*Common costs
Sales value basis = (Xs Sales value @ Split off/ Total Sales Value @ Split off)*Common Costs

Alternative Costing Methods

Cost/cost driver = COST POOL$/No. of Cost drivers
TARGET COST = Estimated SP Expected Profit
BUDGETING
Additive Model, S =Y S , Total to 0
Multiplicative model, S = Y/T , total to 4
Layspeyre P.I. = (PnQ0)/(P0Q0) * 100
Layspeyre Q.I. = (P0Qn)/(P0Q0) * 100
Paasche P.I. = (PnQn)/(P0Qn) * 100
Paasche Q.I. = (PnQn)/(PnQ0) * 100
Fishers index = (Layspeyre * Paasche)
PRODUCTION BUDGET = SALES C/S FG O/P FG
MAT. USAGE BUDGET = PRODUCTION UNITS * STD. USAGE /UNIT
MAT. PURCHASE BUDGET = MAT. USAGE+ C/S MATERIALS O/P MATERIALS
LABOUR BUDGET = PRODUCTION * STD HRS* STD. RATE
VALUE ADDED = Sales Cost of Bought in material and services
Pay back period = Year before recovery +[(unrecovered cost/ cashflow during next year)*12]
S = P(1+r)n
P = S/(1+r)n
Effective annual Interest rate: (1+R) = (1+r)n
Perpetuity = 1/r
IRR = A+[a/(a-b)*(B-A)]*100%

VARIANCE ANALYSIS
MAT. PRICE = AQSP-AQAP
MAT. USAGE = SQSP AQSP
LAB. RATE = AHSR AHAR
LAB. EFFICIENCY = SHSR AAH SR
IDLE TIME = IDLE HRS * SR
VOH EXPENDITURE = AAHSR AAHAR
VOH EFFICIENCY = SHSR AAHSR
FOH TOTAL VARIANCE = ABSORBED OH ACTUAL OH
FOH EXPENDITURE = BUDGETED OH ACTUAL OH
FOH VOLUME = BUDGETED OH (ACTUAL PRODUCTION * STD.OAR/UNIT)
FOH EFFICIENCY = [(ACTUAL PN*STD HRS) ACTUAL HRS]*STD OAR/HR
FOH CAPACITY = (BUDGETED HRS ACTUAL HOURS)*STD OAR/HR
SALES PRICE = AQAP-AQSP
SALES VOLUME = (AQ-BQ)* STD. PROFIT OR STD. CONTRIBUTION
STD PROFIT FROM ACTUAL SALES = BUDGETED PROFIT SALES VOLUME VARIANCE
STD COST OF ACTUAL SALES = BUDGETED PROFIT SALES VARIANCES

PERFORMANCE MEASUREMENT
ROCE = PBIT/CAPITAL EMPLOYED *100%
ROI = PROFIT/INVESTMENT *100%
RETURN ON SALES OR PROFIT MARGIN = PROFIT/SALES REVENUE * 100%
ASSET TURNOVER = SALES REVENUE/CAPITAL EMPLOYED
COST TO SALES RATIO = COST/SALES REVENUE
CURRENT RATIO = CA/CL

QUICK RATIO = CA INVENTORY/CL

RECIEVABLE DAYS = AVG. RECEIVABLES/CREDIT SALES *365
INVENTORY DAYS = AVG INVENTORY/COST OF SALES *365
PAYBALE DAYS = AVG. PAYABLES/CREDIT PURCHASES * 365
WORKING CAPITAL CYCLE = INVENTORY DAYS + RECIEVABLE DAYS PAYABLE DAYS
GEARING RATIO = DEBT/(DEBT+EQUITY)
OPERATING GEARING = OPERATING PROFIT/CONTRIBUTION
INTERSET COVER = PBIT/INTEREST
EPS = PAT AND PREFERENCE DIVIDEND/NO OF ORDINARY SHARES
PE RATIO = PRICE PER SHARE/EPS
DIVIDEND COVER = EPS/DIVIDEND PER SHARE
CAPACITY RATIO = ACTUAL HRS/BUDGETED HRS* 100%
ACTIVITY RATIO = STD HRS/BUDGETED HRS *100%
EFFICIENCY RATIO = STD. HRS/ACTUAL HRS *100%