Variance Analysis and Performance Evaluation at IBM

• Values:

• Standard Cost per Unit: $80
• Actual Cost per Unit: $85
• Budgeted Production: 10,000 units
• Actual Production: 9,500 units
• Requirements:

0. Calculate the materials price variance and labor efficiency variance.
1. Analyze how variance analysis helps in performance evaluation at IBM.
2. Discuss the role of standard costing in cost control and decision-making.
3. Recommend actions to improve cost management based on variance analysis results.