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What do we do? A+ a 1 Consider the following set of circumstances for a business: Materials SQ SP AQ SP AQ 5P AQ AP

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What do we do? A+ a 1" Consider the following set of circumstances for a business: Materials SQ SP AQ SP AQ 5P AQ AP $1,450,000 $1,375,000 $1,525,000 MPV = Unfavorable $150,000 MQV = Favorable $50,000 M so SR Ao SR AQ AR $2,650,000 $2,825,000 $3,100,000 LRV = Unfavorable $275,000 LEV = Unfavorable $175,000 For full credit you will consider what an investigation might involve: 1] Determine at least three positions (people) within the organization that you would interview in order to determine what went wrong. List two questions for each position (person) that will assist the investigation. 2] After your investigation, it has been determined that the purchasing department employee bought higher quality materials than the specications call for. but did not conrm the purchase with anyone nor notify anyone of the higher quality. All of the variances above resulted from this one purchasing decision. Decide how management should respond to this error. What should be the repercussion for the employee and the organization

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