Question 1

Martinez Landscaping plants grass seed as the basic landscaping for business campuses. During a recent month, the company worked on three projects (Remington, Chang, and Wyco). The company is interested in controlling the materials costs, namely the grass seed, for these plantings projects.

In order to provide management with useful cost control information, the company uses standard costs and prepares monthly variance reports. Analysis reveals that the purchasing agent mistakenly purchased poor-quality seed for the Remington project. The Chang project, however, received higher-than-standard-quality seed that was on sale. The Wyco project received standard-quality seed. However, the price had increased and a new employee was used to spread the seed.

Shown below are quantity and cost data for each project.

Actual

Standard

Project Quantity Costs Quantity Costs Total Variance Remington 540lbs.$1,296450lbs.$1,170$126U Chang 4009204101,066146F Wyco 5901,5935001,300293UTotal variance $273U

Display a variance report for the purchasing department.(Round actual and standard price per pound answers to 2 decimal places e.g. 1.25.)

MARTINEZLANDSCAPING

Variance Report - Purchasing Department

For the Current Month

Project

Actual

Pounds Purchased

Actual

Price Per Pound

Standard

Price Per Pound

Price Variance

Explanation

Remington

$

$

$

Favorable

Neither favorable nor unfavorable

Unfavorable

Purchased poor-quality seeds Chang

Unfavorable

Neither favorable nor unfavorable

Favorable

Seeds on sale Wyco

Neither favorable nor unfavorable

Favorable

Unfavorable

Price increased Total price variance$

Unfavorable

Favorable

Neither favorable nor unfavorable

LINK TO TEXT

LINK TO TEXT

Display a variance report for the production department.(Round standard price per pound to 2 decimal places, e.g. 1.25.)

MARTINEZLANDSCAPING

Variance Report - Production Department

For the Current Month

Project

Actual Pounds

Standard Pounds

Standard

Price Per Pound

Quantity Variance

Explanation

Remington

$

$

Unfavorable

Neither favorable nor unfavorable

Favorable

Purchased poor-quality seeds Chang

Unfavorable

Neither favorable nor unfavorable

Favorable

Purchased higher-quality seeds Wyco

Unfavorable

Neither favorable nor unfavorable

Favorable

New employee Total quantity variance$

Favorable

Unfavorable

Neither favorable nor unfavorable

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