UNIT 8 $6,860 ($9,800 X .70) COST OF NEXT 7 UNITS = (8 X $6,860...

100. Correct answer b. The material variance should be investigated since it is $11,000 which is

greater than 10% of the budget ($100,000 x .1). The direct labor variance is $4,000 which

is less than 10% of budget ($50,000 x .1) so it would not be investigated under the

company policy.