Q:
A Complete and examine a performance report
One subunit of Hazelton Sports Company has the subsequent financial results last month:
Hazelton Water Sports Subunit Actual Budget Budget Variance (F or U) Variance %* (U or F)
Direct materials $16,140 $15,000
Direct labor 19,020 20,000
Indirect labor 29,300 25,000
Utilities 13,110 12,000
Depreciation 19,000 19,000
Maintenance and Repairs 3,370 4,000
Total $99,940 $95,000
Requirements
1. Total the performance evaluation report for this subunit (round to four decimals).
2. Based on the data shown, what kind of responsibility center is the subunit?
3. Which items could be investigated if part of the management's decision criteria is to investigate all variances exceeding 10.5% or $2,800?
4. Should only unfavorable variances be investigated? Describe.