evaluates performance? The purchasing manager's performance evaluation efficiency variances. In this case, the production manager be based solely on the price variance. The short-run responsible for the purchase of the lower-quality titanium, which led to the usage rates. In addition, the production manager's performance evaluation efficiency scores. Select the two statements that answer why it is important for Katharine Johnson to understand the causes of a variance before she evaluates performance. Johnson should understand efficiency variances may arise for only one reason and she needs to know that reason before evaluating performance. Johnson should understand efficiency variances may arise for many different reasons and she needs to know these reasons before evaluating performance. It is important for Johnson to understand that all favorable material price variances are "good news", because they are increasing profits. Requirement 5 . Other than performance evaluation, what reasons are there for calculating variances? A. Variances are used to demand higher quality materials from suppliers at the same cost that Groovy Bikes pays now. B. Variances should be used to help Groovy Bikes understand what led to the current set of financial results, as well as how to perform better in the future. C. To use the variance information to negotiate lower prices with suppliers. Requirement 6. What future problems could result from Groory Bikes' decision to buy a lower qual 'ty of titanium from the online marketplace? D. Both A and B. Read the Data table Requirement 1. Compute the direct materials price and efficiency variances. Let's begin by calculating the cost for the actual input at the budgeted price. Next determine the formula and calculate the cost for the flexible budget. Direct materials x = Flexible budget cost Now compute the price and efficiency variances for direct materials. Label each variance as favorable (F) or unfavorable (U). Requirement 2. What factors can explain the variances identified in requirement 1 ? Could any other variances be affected? The is due to the difference between the standard price based on the previous suppliers and the actual price paid through the online marketplace. The could be due to several factors including inexperienced workers, lower quality product, and machine malfunctions. The variance could be affected if the lower quality titanium caused the workers to use more time. Requirement 3. Was switching suppliers a good idea for Groowy Bikes? Explain why or why not. Switching suppliers a good idea. The in the cost of titanuim was outweighed by the material usage. In addition, the variance recognize the total impact of the lower quality titanium because only pounds were used. Groovy Bikes could expect the remaining rounds to result in an additional variance