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Chapter 12 case 2: Rust Belt Mufflers

Case 12-2 Rust Belt Mufflers


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Case 12-2 Rust Belt Mufflers


State St is buying at considering lower than $60 per muffler, paying below standard labor rates and taking less than a hour to install each muffler. They are a strong performer. The way you can figure this out is by comparing their total materials cost to the number of installations x $60 (what they should have paid). You can then compare the hours worked times the actual labor rate and compare to the standard rate permitted. Finally, you can compare the hours worked with the hours permitted given the number of installations. These same comparisons can be made for each location. See Excel where these computations are done and the related ...

Solution Summary

Your tutorial is 432 words plus an excel spreadsheet to compute the requested variances. The variance are evaluated without warranty data and then with the warranty data.