Abrams, Inc Required:
A

question 13

Essay

Abrams, Inc.provides the following results of March's operations:
$$\begin{array} { l r } \text { Direct materials price variance } & \$ 400 F \\\text { Direct materials quartity variance } & 2,000 \mathrm { U } \\\text { Direct labor rate variance } & 100 \mathrm { U } \\\text { Direct labor efficiency variance } & 1,200 \mathrm {F} \\\text { Variable overhead spendirg variance } & 400 \mathrm {U} \\\text { Variable overhead efficiency variance } & 800 \mathrm {F} \\\text { Fixed overhead spending variance } & 100 \mathrm {U} \\\text { Fixed overhead yolume yariance } & 600 \mathrm {F}\end{array}$$ Required:
a.Determine the total overhead cost variance for March.
b.Applying the management by exception approach, which of the variances shown are of greatest concern? Why?
c.Assuming the variances are immaterial and we close them to Cost of Goods Sold, what will the effect be on that account of these variances?

---

Definitions:

Inferential Statistic

A set of mathematical procedures that allows researchers to infer or draw conclusions about a population based on sample data.

Response Time

The amount of time taken to respond to a specific stimulus or event.

Spatial Task

A task that requires the individual to navigate, manipulate, or understand spatial relationships among objects or in an environment.

Sampling Bias

A bias in which certain members of a population are systematically more likely to be selected in a sample than others, skewing the results.