Absorption Costing: Profit Reconciliation Statement

Budgeted profit (Budgeted units x budgeted profit)

Sales variance
Sales price variance

x F or (A)

Sales profit volume variance

x F or (A)
X F or (A)

Actual sales minus the standard full cost of sales

Cost variance

Direct material price

Direct material usage

Direct labour rate

Direct labour usage/efficiency

Variable O/H expenditure

Variable O/H efficiency

Fixed O/H expenditure

Fixed O/H capacity

Fixed O/H efficiency

_____________
Total cost variance

A__
x F x (A)
__________

Actual Profit

__________

Marginal Costing: Profit Reconciliation Statement

Budgeted profit

Add: Budgeted fixed costs

X
___

Budgeted contribution

Sales variances
Sales price variance

x F or (A)

Sales profit volume variance

x F or (A)
X F or (A)

Actual sales minus the marginal full cost of sales

Cost variance

Direct material price

Direct material usage

Direct labour rate

Direct labour usage/efficiency

Variable O/H expenditure

Variable O/H efficiency

Actual contribution

x F/ x (A)
X

Budgeted fixed O/H

Fixed overhead expenditure variance x (F)/ x A

X
Actual Profit

Absorption Costing: Cost Reconciliation Statement

Standard cost of production
Cost Variances

X
F

Direct material price

Direct material usage

Direct labour rate

Direct labour usage/efficiency

Variable O/H expenditure

Variable O/H efficiency

Fixed O/H expenditure

Fixed O/H capacity

Fixed O/H efficiency

_____________
Total cost variance

A__
x (F) x A
__________

Actual cost

__________

Favourable variances are subtracted from standard

costs to reach actual
cost and adverse variances are added.

Marginal Costing: Cost reconciliation Statement

Standard marginal cost of production
Cost Variances

X
F

Direct material price

Direct material usage

Direct labour rate

Direct labour usage/efficiency

Variable O/H expenditure

Variable O/H efficiency

_____________
Total cost variance

A__
x (F) x A
__________

Actual cost

__________