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Performing a variance analysis for a manufacturing process, the following data is provided: Category Actual ($) Budgeted ($) Direct Materials 12,000 10,000 Direct Labor 8,000



  • Performing a variance analysis for a manufacturing process, the following data is provided:

    CategoryActual ($)Budgeted ($)
    Direct Materials12,00010,000
    Direct Labor8,0007,500
    Manufacturing Overhead5,0004,500

    Your requirements are as follows:

    • Calculate the total variance for each category.
    • Analyze the variances into price and efficiency components.
    • Present the analysis in a variance report format.
    • Include a paragraph discussing potential causes of each variance.
    • Provide recommendations for cost control based on the analysis.
    • Summarize the impact of variances on the company's profitability.

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