BUS 202 Lecture 24: April 10th
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Department
BUS - Business Administration
Course
BUS 202
Professor
Nick Ross
Semester
Spring

Description
April 10th Monday, April 10, 2017 9:18 AM • Coffee roasters: ○ Raw beans ---> roasted coffee ○ Standard/ expect: § 3.2 lbs of raw dm at $.80/lb § 1.2 hours dl at 14/hr ○ Last month: § 31,800 lbs of raw beans were used to make 10k lb coffee bought at $.75/lb § 11,232 dlh were used at a cost total of 171,280 ○ Compute DM,DL, price & etf var § DM □ Actual quantity: 31,800 □ Actual price: $.75 □ Standard Quantity: 3.2*10,000=32,000 □ Standard price: $.80 □ AQXAP Price AQ*SP Eff/qty SQxSP 23850 1590 f 25440 160 f 25,600 § DL: □ AQ: 11,232 □ AP: 171,286 □ SQ: 1.2 x 10,000 = 12,000 □ SP $14 AQXAP Price AQ*SP Eff/qty SQxSP □ 15.25*11232=171288 14040 u 11232*14=157248 10,752 f 12,000*14=168,000 § DM Laveat □ Often use variances to evaluate different groups/people □ Price/rate: ® Did the purchasing group do a good job? □ EFF/Qty Var: ® did the workers/factory use inputs efficiently □ What if amount DM purchased doesn’t equal amount used ® AQ: the amount bought when computing price variance ® AQ: the amount used when computing eff/qty • Pewter lawn statues: ○ STD price: $4.00/lb of pewter April 10th Monday, April 10, 2017 9:18 AM • Coffee roasters: ○ Raw beans ---> roasted coffee ○ Standard/ expect: § 3.2 lbs of raw dm at $.80/lb § 1.2 hours dl at 14/hr ○ Last month: § 31,800 lbs of raw beans were used to make 10k lb coffee bought at $.75/lb § 11,232 dlh were used at a cost total of 171,280 ○ Compute DM,DL, price & etf var § DM □ Actual quantity: 31,800 □ Actual price: $.75 □ Standard Quantity: 3.2*10,000=32,000 □ Standard price: $.80 □ AQXAP Price AQ*SP Eff/qty SQxSP 23850 1590 f 25440 160 f 25,600 § DL: □ AQ: 11,232 □ AP: 171,286 □ SQ: 1.2 x 10,000 = 12,000 □ SP $14 AQXAP Price AQ*SP Eff/qty SQxSP □ 15.25*11232=171288 14040 u 11232*14=157248 10,752 f 12,000*14=168,000 § DM Laveat □ Often use variances to evaluate different groups/people □ Price/rate: ® Did the purchasing group do a good job? □ EFF/Qty Var: ® did the workers/factory use inputs efficiently □ What if amount DM purchased doesn’t equal amount used ® AQ: the amount bought when computing price variance ® AQ: the amount used when computing eff/qty • Pewter lawn statues: ○ STD price: $4.00/lb of pewter ® did the workers/factory use inputs efficiently □ What if amount DM purchased doesn’t equal amount used ® AQ: the amount bought when computing price variance ® AQ: the amount used when computing eff/qty • Pewter lawn statues: ○ STD price: $4.00/lb of pewter ○ A + std: 3 lbs / statue ○ Actually made 2,000 statues with 6,500 lbs of pewter ○ Bought 7,000 lbs of pewter for $3.80/lb ○ Dm Variance: § Standard quantity: 2,000 * 3 = 6,000 § Standard price: $4.00 § Actual price: $3.80 § Actual quantity (bought): 7,000 § Actual quantity (used): 6,500 ------ AQxAP Price AQxSP Eff/qty SQxSP varince Price AQ 7,000*3.8= 1400 f 7,000*4= § Bought 26,600 28,000 Aq used 6,500*4= 2,000 u 6,000*4= 26,000 24,000
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