Assignment Objective: Complete variance analysis to analyze management decisions and what caused them. Assess an organization's success by comparing the budgeted plan to actual results.

Assignment Details:

A variance analysis to compare your budget to your actual results was completed at the end of the first quarter. Solve the variance analysis.

1. How was the flexible budget prepared? What is the flexible budgets purpose in variance?
2. What is the Sales Volume Variance? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?
3. What is the Selling Price Variance? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?
4. What is the Direct Material Price & Quantity Variances? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?
5. What is the Direct Labor Rate & Wage Variances? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?
6. What is the Variable Indirect Price & Efficiency Variances? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?
7. What is the Fixed Indirect Price & Volume Variances? Is it favorable or unfavorable? What could have been potential cause of the variance in relation to the cost object? What would be a proactive step to mitigate effects of unfavorable OR optimize favorable variances?