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Company R has produced the following variance analysis report. If Company R has a policy to investigate variances over 10% of the flexible budget, which

  1. Company R has produced the following variance analysis report. If Company R has a policy to investigate variances over 10% of the flexible budget, which variances should be investigated?

Actual

Flexible budget

Budget Variance

Price Variance

Quantity Variance

DM

$98,240

$88,000

$10,240

U

$1,200

U

$9,040

U

DL

$135,580

$190,000

($54,420)

F

($18,000)

F

($36,420)

F

VOH

$198,860

$219,000

($20,140)

F

($2,560)

F

($17,580)

F

The direct materials price variance and the direct materials quantity variance.

The direct materials quantity variance and the variable overhead efficiency variance.

The direct materials quantity variance and the direct labor efficiency variance.

The direct labor rate variance and the direct labor efficiency variance.

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