Setting Next Year’s Standard Cost David Jones. ` Budget Year N Std Cost Year N -ve variance vs.Std cost +ve variance vs.Std cost €10 €8 Budget Year N+1.

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Presentation transcript:

Setting Next Year’s Standard Cost David Jones

` Budget Year N Std Cost Year N -ve variance vs.Std cost +ve variance vs.Std cost €10 €8 Budget Year N+1 3. Std Cost Year N+1 = €9 2. Need to predict what we can achieve here Year N+1 1. Need to review current variances vs standard cost to get this point (End Q2, Beginning Q3 Implementation) Q1 Q2 Q3 Q4 Year N

Std Cost Year N+1 = €9.5 Q1 €10 €8 Year N+1 Q2 Q3 Q4 Std Cost Year N+1 = €8.5 Q1 €10 €8 Year N+1 Q2 Q3 Q4 End Q3, Beginning Q4 Implementation End Q1, Beginning Q2 Implementation