Question
Orange City often hires outside lawyers as consultants to work on specialized legal cases. For Fiscal Year 2018 the city expected to have 25 such
Orange City often hires outside lawyers as consultants to work on specialized legal cases. For Fiscal Year 2018 the city expected to have 25 such cases, with a total cost of $60,000 for the work. This estimate was based on FY 2017 results of 300 hours of the lawyers time billed at $200 per hour. The actual number of cases in 2018 turned out to be only 22, but the lawyers raised their rate to $220 per hour. The total expense for the lawyers was $87,120. What were the total variance, volume variance, quantity variance, and price variance for the lawyers work? Indicate which variances are favorable or unfavorable.
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