Use the Cost Variance Report attached to answer the questions. 1. If the threshold for reporting on sources of variances is 5% over or under budget at the total level; does this report require a variance report for monthly or year-to-date variance? 2. Which of the subaccounts are overrun and underrun in the current month? 3. Which of the subaccounts are overrun and underrun for year-to-date? 4. What were the primary drivers of the current month variance? Use a threshold of $1,000 to indicate a major driver. 5. What were the primary drivers of the year-to-date variance? Use a threshold of $10,000 to indicate a major variance. 6. Training & development is overrun for the current month but underrun for the year. What is the likely cause of these opposite variances? 7. The largest expenditure in the month of June was for Depreciation. Are you concerned that this account may overrun? 8. Based upon the current variances, which account is likely to have the largest overrun? Is there any way to control the variance?

Variance Report June Report Current Month Year-to-date Annual Account Budget Actual Budget Actual Budget Computer - Hardware $1,667 $1,342 $10,000 $8,854 $20,000 Computer - Software $1,667 $1,689 $10,000 $13,872 $20,000 Depreciation $69,105 $69,105 $138,210 $138,210 $276,420 Equipment maintenance $1,000 $921 $6,000 $5,743 $12,000 Furniture & fixtures $1,500 $0 $9,000 $7,488 $18,000 Office Supplies $1,000 $1,126 $6,000 $5,487 $12,000 Personnel - Salaries $51,023 $51,001 $416,875 $413,840 $723,451 Personnel - Benefits $12,765 $12,761 $91,843 $90,923 $185,397 Printing & postage $2,500 $3,351 $15,000 $15,053 $30,000 Professional fees $8,000 $18,500 $50,000 $67,300 $100,000 Training & development $4,000 $17,338 $25,000 $21,722 $50,000 Travel & entertainment $10,000 $14,231 $60,000 $58,639 $120,000 Total $164,227 $191,365 $837,928 $847,131 $1,567,268