Joe Evans is a line supervisor in the Paint Shop of the Auckland Car Company (ACC). The
Question:
Kent: Joe, here are the results for our department for the month of July. I need your help to explain these at the meeting with the plant manager tomorrow. Just look at them. I'm in for a really hard time.
(Evans examines the performance report for the Finishing Department for July, which is shown below.) Evans: Jim, why do you bother with these measures? They're not worth the paper they're written on. We need senior management to understand that when they introduce some decent measures they'll start to some decent results!
Required:
1. Outline the major criticisms of standard costing variances as measures of performance.
2. Use the variance data to provide a brief report on the performance of the Finishing Department.
3. Suggest some alternative performance measures for the Finishing Department that might be useful.
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Related Book For
Management Accounting
ISBN: 9781760421144
7th Edition
Authors: Kim Langfield Smith, Helen Thorne, David Alan Smith, Ronald W. Hilton
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