About This Chapter
Cost & Variance Measures in Performance Management - Chapter Summary
A great way to strengthen your knowledge of cost and variance measures in performance management is to review lessons that cover the subject. This chapter is filled with entertaining video and text lessons you can explore online using any computer or mobile device with an Internet connection. Enjoy the convenience of studying when your schedule permits. When finished with this chapter, you will be able to:
- Define cost variance, and pinpoint the source of different types of variances
- Discuss the advantages and disadvantages of management by exception
- Explain how to complete a flexible budget performance report
- Share the benefits and limitations of the standard cost accounting system
- Describe how to analyze variances in budgets
Feel free to use this chapter's resources in a way that best suits your study goals. Review the entire chapter any sequence, or select just a handful of lessons to examine based on your current and desired knowledge of cost and variance measures in performance management. Assess your knowledge of lesson concepts by taking multiple-choice quizzes. If you have questions, don't hesitate to submit them to our experts.
1. Cost Variance: Definition, Formula & Analysis
Every business should be reviewing any differences between planned and actual costs. Those differences are called cost variances. This lesson will show you how to determine the source of different types of variances.
2. Management By Exception: Definition and Limitations
Sometimes things go as planned, and sometimes they don't. In this lesson, you'll learn about management by exception, including how it works and its advantages and disadvantages. You'll also have an opportunity to take a short quiz.
3. How to Complete a Flexible Budget Performance Report
A flexible budget performance report can act as a report card on your department's flexible budget, letting people know what adjustments should be made to it for more accuracy in the future.
4. Standard Cost Accounting System: Benefits & Limitations
Standard cost accounting is one of the most common forms of accounting systems. In this lesson, we will learn how it is used, as well as its benefits and limitations. We will also learn about the variances that occur using this accounting method.
5. Variances in Budgets: Definition, Calculations & Analysis
What are variances in budgets, and why do we calculate them? In this lesson, we discuss what they are, why we care about them, and how to analyze variances in our own reports to obtain information we can use to improve our results.
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Other chapters within the Certified Management Accountant (CMA): Study Guide & Test Prep course
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- Financial Strategic Planning
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- Annual Profit Planning
- Financial Projections
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- Performance Measurement in Accounting
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- Overhead Costs
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- Financial Statement Special Issues
- Basics of Corporate Finance
- Capital Management Overview
- Corporate Restructuring
- International Finance Practices
- Business Decision Analysis
- Risk Management for Business
- Investment Decisions
- Accountant Professional Ethics
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