ACC 202 WORSKSHOP FOUR VARIANCES HANDOUT FOR 4.4 DROPBOX
Download Variances Handout for 4.4 Dropbox Review the questions below. As you watch the video Reasons for Direct Material and Direct Labor Variances, take notes and answer the following questions for Dropbox submission:
Question 1. What are some possible causes of an unfavorable direct labor cost variance? 2. What are some possible causes of a direct material cost variance? 3. If purchasing a more expensive grade of raw material reduces waste and improves labor efficiency, how might that affect the variances for production costs? Give all of the impacts on variances that might result. 4. How might providing production workers with better training or more laborsaving devices affect the direct labor variances? Would the cost of the training or devices appear in the labor cost per hour, holding everything else constant? 5. Why might the purchasing manager prefer to use lower quality materials? How might the plant manager address that problem?