| ACC 2706 Textbook X Microsoft Edge x New tab x |Nine jailed for tam x ) ACC2708 - Week 7 x ) 2708 final notes ov X ) ACC2708 Corporat X ) Advanced Financia X ( ACC2706 Sem1AY2 X BBE ACC 2706 Textbook X + X G File | C:/Users/ellio/Downloads/ACC%202706%20Textbook%208e.pdf Contents 542 of 1132 Q - | Page view | A Read alot p10 12/17 V X P10.42 Investigating standard cost variances: manufacturer LO10.6 Allan Ltd manufactures gardening equipment. At a recent staff meeting, the following direct labour variance report for the past year was presented by the management accountant: CHAPTER TEN STANDARD COSTS FOR CONTROL: DIRECT MATERIAL AND DIRECT LABOUR Allan Ltd Direct labour variance report Direct labour rate variance Direct labour efficiency variance Percentage of Percentage of Amount standard cost Amount standard cost January $1 600 F 0.10 $10000 U 1.00 February 9800 F 0.98 15000 U 1.50 March 200 U 0.02 19400 U 1.94 April 4000 U 0.40 25 600 U 2.56 May 7600 F 0.76 40 200 U 4.02 June 7800 F 0.78 34000 U 3.40 July 8400 F 0.84 $7000 U 5.70 August 10200 F 1.02 76000 U 7.60 September 9 600 F 0.96 74000 U 7.40 October 11 400 F 1.14 84000 U 8.40 November 8 400 F 0.84 120000 U 12.00 December 8600 F 0.86 104000 U 10.40 Allan Lid's management accountant uses the following rule of thumb: investigate all variances equal to or greater than $60000 or 6 per cent of standard cost. Required: 1. Which variances would have been investigated during the year? (Indicate month and type of variance.) 2. What characteristics of the variance pattern shown in the report should draw the accountant's attention, regardless of the usual investigation rule? Explain. Given these considerations, which variances would you have investigated? Why? 3. Is it important to follow up on favourable variances, such as those shown in the report? Explain your answer. 4. The management accountant believes that the firm's direct labour rate variance has a normal probability distribution with a mean of zero and a standard deviation of $10000. Prepare a statistical control chart, and plot the company's direct labour rate variances for the year. The critical value is one standard deviation. Which variances would have been investigated under this approach? P10.43 Labour variances: hospital 010.5 Activate Windows Mountain View Hospital has adopted a standard costing system for evaluation and control of nursing labour. 10.7 Diagnosis related groups (DRGs) are used as the output measure in the standard costing system. A DRG is a Go to Settings to activate Windows. classification scheme for treatments, and hospitals are reimbursed by the government based on the number of patients that they treat in each DRG category. Mountain View Hospital has developed standard nursing Type here to search O 26.C Mostly cloudy ~ DI Ed (7% () ENG 9:10 pm 17/10/2021