Decision to investigate a variance

Assignment Help Other Subject

Reference no: EM1367126

Assume that the budgeted cost for a department is $10,000 per week and the standard deviation is $500. The decision to investigate a variance requires a comparison of expected benefits with expected costs. Suppose an unfavorable variance of $1,000 is observed. The normal distribution indicates the probability of observing this variance is .0228 if the system is in control. Furthermore, assume that the benefits would be 50 percent of the variance and the investigation costs are $200. Should this variance be investigated? Assume that the vairance is still $1,000, but it is favorable. Should it still be investigated?

Reference no: EM1367126

Questions Cloud

Buying imports versus buying domestic products : Determine the advantages or disadvantages of buying imports versus buying domestic products in relation to fashion industry.

Jcaho requirements for documenting : You frequently hear references to JCAHO requirements for documenting a patient's pain assessment and treatment, documenting medication administration, or documenting verbal telephone orders.

Calculate the forward discount : Calculate the forward discount or Premium for the Mexican peso whose 90-day forward rate is $.102 and spot rate is $.10. State whether your answer is a discount or premium.

Provide an expression in relational algebra : Provide expression in relational algebra for each of the following queries: Give all the managers in database a 10 percent salary raise. Give all the other employees a 5 percent salary raise.

Decision to investigate a variance : The decision to investigate a variance requires a comparison of expected benefits with expected costs. Suppose an unfavorable variance of $1,000 is observed.

Supply-demand-equilibrium quantity and price : Find out the quantity demanded, the quantity supplied, and the magnitude of the shortage if a price ceiling of $30 is imposed in this market. Also determine the full economic price paid by consumers.

Explain ping sweeps and port scans : Your boss has just heard about some nefarious computer activities known as ping sweeps and port scans. He wishesto know more about them and what the impact of these activities might be on company.

Estimating consumer surplus : The demand curve for the product X is given by Qdx = 460 - 4Px. How much consumer surplus do consumers receive when Px = $35?

Determine the price to maximize revenues : Suppose you are a manager at the DaimlerChrysler. Daimler-Chrysler has lost fund on the Smart car since 1st model rolled off the assembly line in 1998.

User Account

All Pages