Question
In: Accounting
Determining the reasons for variances is an important part of the overall process of variance analysis....
Determining the reasons for variances is an important part of the overall process of variance analysis. Certain causes are commonly attributed to specific variances. Match each reason on the left with the variance(s) it commonly creates. Each numbered item has one or more correct answer(s). Each lettered item may be used once, more than once, or not at all.
- A change in the quality of materials purchased
- A new supplier contract
- Error in the accounting records
- Change in proportion of spoiled materials
- Unreasonable standard
- Unanticipated overtime hours
- A change in the government-mandated minimum wage
- Equipment malfunction
- A change in average worker experience or training
|
A |
Direct materials price variance |
|
B |
Direct materials quantity variance |
|
C |
Direct labor rate variance |
|
D |
Direct labor efficiency |
Please use full paragraphs, and APA formatting, to explain why you made the connections that you did.
Solutions
Expert Solution
Unreasonable standards in purchase department may lead to material price and quantity variances and in labour department will lead to labour price and efficiency variances.Similarly for error in accounting records too.
ekkarill92 answered 2 years agoRelated Solutions
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2.95
3.45
3.50
3.75
3.48
3.26
3.33
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3.30
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The variance in a production process is an important measure of
the quality of the process. A large variance often signals an
opportunity for improvement in the process by finding ways to
reduce the process variance.
Machine 1
2.95
3.45
3.50
3.75
3.48
3.26
3.33
3.20
3.16
3.20
3.22
3.38
3.90
3.36
3.25
3.28
3.20
3.22
2.98
3.45
3.70
3.34
3.18
3.35
3.12
Machine 2
3.22
3.30
3.34
3.28
3.29
3.25
3.30
3.27
3.37
3.34
3.35
3.19
3.35
3.05
3.36...
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2.
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Std Qty
Std Price/Rate
Direct material (mix)
6
lbs
0.06
per lb
Direct labor
1
hours
$16
per hour
Variable O/H (based on direct labor hours)
1
hours
$8.30
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Standard Cost per Unit:
Standard Cost
Direct Material
?
Direct Labor
?
Variable O/H...
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