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Assignment - Outsourcing Budgets & Variance Analysis Questions
Description - Many questions in both the Complete sections will have more than one part. Be sure to answer each part of each question. If a question requires mathematical calculations, in order to meet the word count quota, after solving please explain the calculations. Apply research information from other websites or periodicals.
1. What is the concept of Outsourcing? What is the rational that corporate managers use in determining Make-or-Buy decisions.
2. What are the factors that influence corporate managers to drop a product or service.
3. What is a zero-based budget? Participative budget?
4. Variance analysis Perform a basic variance analysis for Mike Tire Manufacturing.
Flexible Budget
Actual Cost
Flexible Budget Variance
Direct Materials
$75,500
$74,000
Direct Labor
101,250
104,650
Variable overhead
34,500
33495
Total Manufacturing Cost
$211,250
$212145
5. How is a fixed overhead budget variance computed? How is a fixed overhead volume variance computed?
6. How is variance analysis used by corporate management?
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