Conceptual objectives:

1. Define standard costs and explain how standard cost information is useful for management by exception.
2. Describe variances and what they reveal about performance.

Analytical objectives:

1. Analyze changes in sales from expected amounts.

Procedural objectives:

     1.    Prepare a flexible budget and interpret a flexible budget performance report.
     2.   Compute materials and labor variances.
     3.   Compute overhead variances.
     4.   Prepare journal entries for standard costs and account for price and quantity variances.