Comprehensive variance analysis, responsibility issues. (CMA, adapted) Styles Inc. man- ufactures a full line of well-known sunglasses frames and lenses. Styles uses a standard costing system to set attainable standards for direct materials, labour, and overhead costs. Styles reviews and revises standards annually, as necessary. Department managers, whose evalua- tions and bonuses are affected by their department's performance, are held responsible to explain variances in their department performance reports. Recently, the manufacturing variances in the Image prestige line of sunglasses have caused some concern. For no apparent reason, unfavourable materials and labour variances have occurred. At the monthly staff meeting, Jack Barton, manager of the Image line, will be expected to explain his variances and suggest ways of improving performance. Barton will be asked to explain the following performance report for 2009:LO1

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Actual Results Static-Budget Amounts Units sold 7,275 7,500 Revenues $596,550 $600,000 Variable manufacturing costs $351,965 $324,000 Fixed manufacturing costs $108,398 $112,500 Gross margin $136,187 $163,500