Business, 21.04.2020 19:26 noslengerman

Exercise 10-30 Cost Variance Investigation (LO 10-4)The director of cost management for Odessa Company uses a statistical control chart to help management determine when to investigate variances. The critical value is 1 standard deviation. The company incurred the following direct-labor efficiency variances during the first six months of the current year. January $ 500 F February 1,600 U March 1,400 U April 1,800 U May 2,100 U June 2,400 U The standard direct-labor cost during each of these months was $38,000. The controller has estimated that the firm’s monthly direct-labor variances have a standard deviation of $1,900.Required:a. Determine the cutoff value for investigation if the controller’s rule of thumb is to investigate all variances equal to or greater than 6 percent of standard cost. b. Based on the cutoff value, which of the month(s) will have their direct-labor efficiency variance investigated?

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Exercise 10-30 Cost Variance Investigation (LO 10-4)The director of cost management for Odessa Compa...

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