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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:
Category Actual ($) Budgeted ($) Direct Materials 12,000 10,000 Direct Labor 8,000 7,500 Manufacturing Overhead 5,000 4,500 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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