In the book Advanced ManageriaiAccounting. Robert P. Magee discusses monitoring cost variances. A cost variance is the difference between a budgeted cost and an actual cost. Magee describes the following situation: Michael Bitner has responsibility for control of two manufacturing processes. Every week he receives a cost variance report for each of the two processes, broken down by labor costs, materials costs. and so on. One of the two processes, which we'll call process A , involves a stable, easily controlled production process with a little fluctuation in variances. Process 3 involves more random events: the equipment is more sensitive and prone to breakdown, the raw material prices uctuate more, and so on. "It seems like I'm spending more of my time with process Bthan with process A," says Michael Bitner. "Yet I know that the probability of an inefciency developing and the expected costs of inefficiencies are the same for the two processes. It'sjust the magnitude of random fluctuations that differs between the two. as you can see in the information below." \"At present, I investigate variances if they exceed $2,467, regardless of whether it was process A or B. I suspect that such a policy is not the most efcient I should probably set a higher limit for process 3.\" The means and standard deviations of the cost variances of processes A and B, when these processes are in control. are as follows: (Round your 2 value to 2 decimal places and final answers to 4 decimal places}: Process A Process .9 mean coat variance [in control) $ 2 $ 2 Standard deviation of cost variance (in control) $4,578 $9,941 ' Furthermore, the means and standard deviations of the cost variances of processes A and B. when these processes are out of control, are as follows: Process A Process 3 Heart cost variance [out of control) 57,793 $ 6,901 Standard deviation of cost variance (out of control] $4,578 $9,941 (a) Recall that the current policy is to investigate a cost variance if it exceeds $2,467 for either process. Assume that cost variances are normally distributed and that both Process A and Process Bcost variances are in control. Find the probability that a cost variance for Process A will be investigated. Find the probability that a cost variance for Process Bwill be investigated. Which ln-control process will be investigated more often. magma more often. in] Assume that cost variances are normally distributed and that both Process A and Process 3 cost variances are out of control. Find the probability that a cost variance for Process A will be investigated. Find the probability that a cost variance for Process 3 will be investigated. Which out-of-control process will be investigated more often. islrwssiigaiad more often