Anders Painting Service specializes in painting tall office buildings. During a recent month, the company worked on three painting projects (the Arrow Building, the Besler Building and the Cartrwright Building). The company is interested in controlling the materials costs, namely the paint, used for these painting contracts. In order to provide management with useful cost control information, the company uses standard costs and prepares monthly variance reports. Analysis reveals that the purchasing agent mistakenly purchased poor-quality paint for the Arrow Building project. The Besler Building project, however, received higher-than-standard-quality paint that was on sale. The Cartwright Building project received standard-quality paint. However, the price had increased and a new employee was used to paint the building. Shown below are quantity and cost data for each project. Actual Project Arrow Building Besler Building Cartwright Building 4,500 Total variance Quantity 3,750 gallons 3,800 Standard Quantity 3,500 gallons $280,000 4,000 4,200 Total Variance $ 5,000 U 23,600 F 33.000 U $14.400 U Costs Costs $285,000 $296,400 $369,000 $320,000 $336,000 Instructions (a) Prepare a variance report for the purchasing department with the following columns: (1) Project, (2) Actual Gallons Purchased, (3) Actual Price, (4) Standard Price, (5) Price Variance, and (6) Explanation. Prepare a variance report for the production department with the following columns: (1) Project, (2) Actual Gallons, (3) Standard Gallons, (4) Standard Price, (5) Quantity Variance, and (6) Explanation. In an effort to improve performance, Anders Painting Service found a new supplier that sold average quality paint. The initial quantity and cost data for each project is below: (b) (c) Actual Costs Standard Costs 3,500 gallons $280,000 $320,000 $336,000 Total Variance $ 6,525 U 21,700 F 5.475 U $ 9,700 F Project Arrow Building Besler Building Cartwright Building 4,350 Total variance Quantity 3,650 gallons $286,525 3,800 Quantity $298,300 $341,475 4,000 4,200 (1) Prepare a variance report for the purchasing department with the following columns: (1) Project, (2) Actual Gallons Purchased, (3) Actual Price, (4) Standard Price, (5) Price Variance, and (6) Explanation. (2) Prepare a variance report for the production department with the following columns: (1) Project, (2) Actual Gallons, (3) Standard Gallons, (4) Standard Price, (5) Quantity Variance, and (6) Explanation. (3) Discuss whether the change to the new supplier is beneficial to Anders Painting Service and why or why not.