1. Refer to the Managerial Application ‘‘An Antidote to Biased Standards: How Workers Develop Their Own Standards at NUMMI'' on page 355. What were the benefits of worker involvement in setting the standards at NUMMI?
2. How would a coffee shop use labor and materials variance information?
3. Why is a materials efficiency variance typically not calculated for the purchasing activity?
4. Why might the total variable manufacturing overhead variance not be divided into price and efficiency components?
5. How would you compute price and efficiency variances for taxicab drivers where the major variable costs are drivers' wages and automobile costs?
6. How could a CPA firm use mix variances to evaluate performance? (Appendix 10.1)