Assign 7-3 - The 2 most significant variances we learnt in...

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Problem 8-13A Direct Materials (AQ* AP) (AQ* AP) (AQ* AP) 236900 11500* 22 8400*22 =253000 =184800 8500*22 = 187000 Price Variance is 16100 F and Quantity Variance is 2200 U * I would sign the contract because of the favorable price variance Direct Labor (AH* AR) (AH* SR) (SH* SR) 160*36*11.90 160*36*12 4200*1.3*12 =68544 69120 65520 Total variance is 3024 U * would not recommend new mix, we can save in money spent on labor, but the new people were not producing efficiently. Direct Overhead (AH* AR) (AH* SR) (SH* SR) 16416 160*36*3 4200*1.3*3 =17280 = 16380 Total Variance is 36 U 16100 F 2200 U 576 F 3600 U 864 F 900 U
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* both OH spending and labor are favorable where as they are not used efficiently.
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Unformatted text preview: The 2 most significant variances we learnt in this table would be the direct labor and the direct overhead. We can see that the company paid more labor maybe because they were using spets to do the job, but they were doing a better job and it was more efficient. However, the total variance was still unfavorable meaning, they were probably better off with old set of people. Another number would be the direct overhead. Overhead is paid for and is being used very efficiently....
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This note was uploaded on 10/10/2010 for the course ACCT 225 S taught by Professor Webster during the Spring '10 term at Franklin.

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Assign 7-3 - The 2 most significant variances we learnt in...

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