VARIA NCE ANA LYSIS
Blue Spruce Small Appliance Repair has well-defined time and material specifications for every type of job that comes into the shop. During April, while there was a lot of business, profitability was off. Gordon Andrews, manager of Blue Spruce, decides to do a variance analysis of the month’s activities to determine what happened. The following table details the results of this study.
a. Complete a price and efficiency variance for the materials used by Blue Spruce.
b. Complete a price and efficiency variance for the labor used by Blue Spruce.
c. Where is the biggest problem? Why?
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