https://www.youtube.com/watch?v=1o9mVZxoayA

AUTOMOBILE TIRES

How would the company go about setting standars for this product? What types of standards would be inluded? How would managers of the company use the standard costs? Assume the company reported the following variances in the most recent period. Can you think of a scenario that would eplain each of the comination of variences?

1. Unfavorable direct paterials price variance, faborable direct materials usage variance, and unfavorable direct materials spending variance.

2. Favorable direct labor rate variance, unfaborable direct labor efficiency variance, and unfaborable direct labo spending variance.

3. Unfaborable direct labo efficiency variance and unfaborable variable overhead efficiency variance.

4. Faborable fixed oberhead spending variance and faborable fixed overhead volume variance.