Title: Standard Costing
Course: BAC300: Management Accounting I (PEBL) > Section: LESSON EIGHT: Standard Costing

1.1  Introduction

In this first lesson, we lay the foundation for the entire course by defining the concept entrepreneurship and other related terms. Throughout our teaching experiences, we have found that an understanding of the basic principles behind the subject and their applications increases the students’ motivation for the subject. We therefore introduce you to the theories upon which entrepreneurship study is based and encourage you to engage in in-depth discussions of these concepts and theories. Since the term entrepreneurship is closely associated with small businesses, we introduce the concept of small business too. The purpose of this lesson is to enable you understand fundamental concepts and theories of entrepreneurship.

8.1 Introduction

Lesson-level overview | Lesson/week/section | 8.
Lesson name: | Standard Costing
Aim of the lesson: | This lesson aims at helping you understand the meaning and nature of standard costing, standard cost and the importance of standard costing in real life situations.
This lesson covers:
- Standard costing.
- Standard cost.
- Importance of standard costing.
Intended learning outcomes:
At the end of this lesson, you will be able to:

1. Define standard costing.
2. Explain standard cost.
3. Explain the importance of standard costing.

Overview of student activity: | 1.Pre-lesson activity – Watching a video on standard costing 2. Engaging in e-tivities 8.1, 8.2, 8.3 that involves  reading linked resources and watching videos on nature and importance of standard costing 3. Interactions on the discussion forums

Constructive alignment of Lesson level outcomes with module level outcomes, learning activities and assessment

(Pressing <Tab> at the end of the table will provide additional rows in the table, if required.)
Intended lesson learning outcomes: | No of module-level outcome | Activity where students engage with this outcome | Where and how is this outcome assessed?
At the end of this Lesson, you will be able to:
Define standard costing. | 4 | 8.1 | 8.1 (a),(b) and (c) Short answer questions
Explain standard cost. | 4 | 8.2 | 8.2 (a),(b) and (c) Short answer questions
Explain the  importance of standard costing | 4 | 8.3 | 8.3 (a) Short answer questions

Detailed explanation of ALL student and teacher engagement with the Lesson:

(This should be presented in the order that the activities take place.  So if students do work online before coming to the lecture, that should be shown ahead of what happens in class.

If there is more than one opportunity for face-to-face contact, or more than one online task, there should be a separate section for each instance, and they should be presented in the template in the same order that students encounter them.)

Content – such as lecture material – can EITHER be shown here OR added as clearly identifiable addenda to the document.  If you plan to use addenda, you should ensure that these are cross-referenced in this section.)
Module-level outcomes addressed:
Lesson eight addresses module learning outcome 4, evaluation of financial performance.
Purpose of the lesson/week/section:
This lesson enables you to evaluate financial performance using standard costing. You will use standard cost technique to evaluate variance in costs.
Over to you: (a description of the process of the section)
You will watch a pre-lesson video which will give an overview of standard costing. You will then read the linked resources to enable you define standard costing and explain nature and importance of standard costing in  e-tivities  8.1, 8.2 and 8.3. You will answer the questions on the discussion forums and respond to your peers’answers.
Pre-lesson activity: | Number of hours | 1
Watch video  and make short notes on standard costing to help you complete e-tivity 8.1
Face to face time: (if applicable) | Number of hours | 1
Explain the learning outcomes

Explain the link between the previous lesson and the current one

Introduce the standard costing, standard cost and importance of standard costing

E-tivity 8.1

Online activity: | Number of hours | 1
What should students do?
E-tivity 8.1

Watch video and read the resources provided on link1 and link2 and then;

(a) Define standard costing.

(b) Explain nature of standard costing.

(c) Explain objectives of standard costing system.

(d) Once you have posted your answers on the discussion forum, read what three of your colleagues in the tutorial groups have posted and note the definition and components of standard costing. Add any new definition and component to your notes.
Where do they do it? | On the discussion forum 8.1
By when should they do it? | Before next lesson.
E-moderator/tutor role
Ensure that learners are focused on the contents and context of discussion, Stimulate further learning and generation of new ideas, Provide feedback on e-tivity 8.1 tasks, Close the e-tivity.
How are the learning outcomes in this Lesson assessed? | Number of hours | 1
Short answer questions
How does this section link to other sections of the module?
It is the introduction lesson of standard costing and forms the basis for further interactions in lesson 9 and 10.

E-tivity 8.2

= Total number of hours | 4 |
Online activity: | Number of hours | 1
What should students do?
E-tivity 8.2

Read Principles of Accounting, Volume 2: Managerial Accounting on pp. 406-411 and  Standard Costs chapter 10.2 and then;

(a) Define the term standard cost.

(b) Explain types of standards.

(c) Explain preparation of standard cost.

Post your answers to questions a), b) and c) in your portfolio
Where do they do it? | Portfolio
By when should they do it? | Before next lesson.
E-moderator/tutor role
Marking the work in the students portfolio and providing feedback on e-tivity 8.2 tasks.
How are the learning outcomes in this Lesson assessed? | Number of hours | 1
Short answer questions.
How does this section link to other sections of the module?
It is a continuation of standard costing and forms the basis for further interactions.

E-tivity 8.3

Online activity: | Number of hours | 1
What should students do?
E-tivity 8.3

The slide above gives you a summary of the importance of standard costing. Read   resource 1 (chapter 8) and resource 2 to get more details on the same and then:

(a) Explain the importance of standard costing in your own words.

(b) Once you have posted your answers on the discussion forum, read what three of your colleagues in the tutorial groups have posted and note the importance of standard costing. Add any new importance of standard costing to your notes.
Where do they do it? | On the discussion forum 8.3
By when should they do it? | Before next lesson.
E-moderator/tutor role
Ensure that learners are focused on the contents and context of discussion.
How are the learning outcomes in this lesson assessed? | Number of hours | 1
Essay question
How does this section link to other sections of the module?
It lays the foundation to the next lesson, which is variance analysis

Some important questions

Which learning resources/ references will scaffold the students’ learning?
1. MitchelL, F., Moyne, C. Patty, G. & Dixon, C. (2019) Principles of accounting, Vol  2:managerial accounting, OpenStax , Houston, Texas. Chapter 8.
2. Jonick, C. (2019) Principles of Managerial Accounting. Business Administration, Management, and Economics Open Textbooks. Chapter 8
3. Kurt, H., Sierra, C. Joe, & H. (2012) Managerial Accounting, Saylor Foundation. Chapter 10
4. Kanwaljeet K.(2017) standard costing retrieved from https://www.youtube.com/watch?v=TNB3M2BdxFU
5. The Audiopedia (2017)Standard cost accounting, retrieved fromhttps://www.youtube.com/watch?v=A844aDkY_J4
How are students enabled to access the resources? | Resources are shared in the module that is loaded in the Learning Management System (LMS) and all students have access to it. The same module is placed on the OER Africa website.
Where in this lesson are students expected to work collaboratively? | Discussion forum 8.1 and 8.3
How has an inclusive approach been incorporated in this lesson? | a) Use of multimedia resources in the module and differentiated learning activities. b) Use university computer labs, all resources are downloadable for offline use and discounted data bundles are available to students. c) Use of accessibility button for learners with special needs on the LMS.
How will feedback on lesson be obtained from students? | Through the posts in the discussion forum 8.1 and 8.3
How will student feedback be used to improve lesson? | By incorporating suggestions in the course for the current and subsequent cohorts.
At which point(s) will students receive formative feedback on the work they have done in the lesson? | Before the next lesson.