10 flexible budgets & performance analysis

Chapter 010, Flexible Budgets and Performance Analysis

Question Type

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ID OriginCMA/CPA origin

1 T/F E x 2/e: 9-2 Authors2 T/F E x 5/e: 10-6 Authors3 T/F E x 11/11/2007 A1 E.N.4 T/F M x 11/11/2007 A9 E.N.5 T/F M x 11/11/2007 A12 E.N.6 T/F M x 11/11/2007 A17 E.N.7 T/F M x 11/11/2007 A22 E.N.8 T/F E x 11/11/2007 A27 E.N.9 T/F M x 11/11/2007 A33 E.N.

10 T/F E x 11/11/2007 A38 E.N.11 T/F E x 11/11/2007 A42 E.N.12 T/F E x 11/11/2007 A46 E.N.13 T/F M x 11/11/2007 A4 E.N.14 T/F E x 11/11/2007 A51 E.N.15 T/F M x 11/11/2007 A55 E.N.

16Conceptual

M/C E x CMA 3/e: 10-17 CMA

17Conceptual

M/C E x CIMA

CIMA, Nov 1996, Stage 2, Operational Cost CIMA

CIMA, Nov 1996, Stage 2,

10-1


Accounting , Q1.3

Operational Cost Accounting , Q1.3

18Conceptual

M/C E x EN, 11/11/2007, A4 E.N.

19 M/C E x5/3/2003 Single MC A3 E.N.

20 M/C E x5/3/2003 Single MC B3 E.N.

21 M/C E x9/22/2004 Single MC AA3 E.N.

22 M/C E x9/22/2004 Single MC AB3 E.N.

23 M/C E x11/17/2007 Single MC AA1 E.N.

24 M/C E x11/17/2007 Single MC BA1 E.N.

25 M/C E x11/17/2007 Single MC AB1 E.N.

26 M/C E x11/17/2007 Single MC BB1 E.N.

27 M/C E x11/17/2007 Single MC CA1 E.N.

28 M/C E x11/17/2007 Single MC CB1 E.N.

29 M/C E x11/17/2007 Single MC FA1 E.N.

30 M/C E x11/17/2007 Single MC FB1 E.N.

31 M/C E x x11/17/2007 Single MC EC1 E.N.

32 M/C E x x11/17/2007 Single MC FC1 E.N.

10-2


33 M/C E x11/17/2007 Single MC CA1 E.N.

34 M/C E x11/17/2007 Single MC BC1 E.N.

35 M/C E x11/17/2007 Single MC CC1 E.N.

36 M/C E x x11/17/2007 Single MC ED1 E.N.

37 M/C E x x11/17/2007 Single MC FD1 E.N.

38 M/C M x5/4/2003 Single MC C3 E.N.

39 M/C E x5/4/2003 Single MC D3 E.N.

40 M/C E x5/4/2003 Single MC E3 E.N.

41 M/C H x5/4/2003 Single MC F3 E.N.

42 M/C H x5/4/2003 Single MC G3 E.N.

43 M/C E x11/17/2007 Single MC DA1 E.N.

44 M/C E x11/17/2007 Single MC BD1 E.N.

45 M/C E x11/17/2007 Single MC CD1 E.N.

46 M/C E x11/17/2007 Single MC EA1 E.N.

47 M/C E x11/17/2007 Single MC EB1 E.N.

10-1 48-51 Multipart M/C E x x x

11/17/2007 MC DA1 E.N.


11/17/2007 MC DB1 E.N.


11/17/2007 MC DC1 E.N.


11/17/2007 MC DD1 E.N.

10- 64-66 Multipart M/C M x x 11/16/2007 MC E.N.

10-3


5 AG110-6 67-69 Multipart M/C E x x

11/16/2007 MC AH1 E.N.

10-7 70-72 Multipart M/C M x x

11/16/2007 MC BG1 E.N.

10-8 73-75 Multipart M/C E x x

11/16/2007 MC BH1 E.N.

10-9 76-78 Multipart M/C M x x

11/17/2007 MC CG1 E.N.

10-10 79-81 Multipart M/C E x x

11/17/2007 MC CH1 E.N.

10-11 82-85 Multipart M/C M x x 11/16/2007 MC AI1 E.N.10-12 86-89 Multipart M/C M x x 11/16/2007 MC BI1 E.N.10-13 90-93 Multipart M/C M x x 11/17/2007 MC CI1 E.N.10-14 94-98 Multipart M/C M x x 11/16/2007 MC AJ1 E.N.10-15

99-102 Multipart M/C M x x

11/16/2007 MC AK1 E.N.

10-16


11/16/2007 MC AL1 E.N.

10-17


11/16/2007 MC AM1 E.N.

10-18


11/16/2007 MC AN1 E.N.

10-19

115-119 Multipart M/C M x x 11/16/2007 MC BJ1 E.N.

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11/16/2007 MC BK1 E.N.

10-21


11/16/2007 MC BL1 E.N.

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11/16/2007 MC BM1 E.N.

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11/16/2007 MC BN1 E.N.

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11/17/2007 MC CJ1 E.N.

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10-25


11/17/2007 MC CK1 E.N.

10-26


11/17/2007 MC CL1 E.N.

10-27


11/17/2007 MC CM1 E.N.

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11/17/2007 MC CN1 E.N.

10-29

157-159 Multipart M/C E x

9/22/2004 Multi MC A3 E.N.

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9/22/2004 Multi MC B3 E.N.

10-31

163-165 Multipart M/C M x

11/15/2007 MC AA1 E.N.

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11/15/2007 MC AB1 E.N.

10-33


11/15/2007 MC AC1 E.N.

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11/15/2007 MC AD1 E.N.

10-35


11/15/2007 MC AE1 E.N.

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11/15/2007 MC AF1 E.N.

10-37


11/16/2007 MC BA1 E.N.

10-38


11/16/2007 MC BB1 E.N.

10-39


11/16/2007 MC BC1 E.N.

10-40


11/16/2007 MC BD1 E.N.

10-41


11/16/2007 MC BE1 E.N.

10-42


11/16/2007 MC BF1 E.N.

10-43


11/17/2007 MC CA1 E.N.

10- 202- Multipart M/C E x 11/17/2007 MC E.N.

10-5


44 204 CB110-45


11/17/2007 MC CC1 E.N.

10-46


11/17/2007 MC CD1 E.N.

10-47


11/17/2007 MC CE1 E.N.

10-48


11/17/2007 MC CF1 E.N.

10-49


9/22/2004 Multi MC C3 E.N.

10-50


9/22/2004 Multi MC D3 E.N.

10-51


9/22/2004 Multi MC E3 E.N.

10-52

226-229 Multipart M/C E x x

11/17/2007 Multi MC EA1 E.N.

10-53

230-233 Multipart M/C E x x

11/17/2007 Multi MC EB1 E.N.

234 Problem M x x11/12/2007 Problem AG1 E.N.

235 Problem E x x11/12/2007 Problem AH1 E.N.

236 Problem E x x11/12/2007 Problem AI1 E.N.

237 Problem E x x11/12/2007 Problem AJ1 E.N.

238 Problem M x x11/12/2007 Problem BG1 E.N.

239 Problem E x x11/12/2007 Problem BH1 E.N.

240 Problem E x x11/12/2007 Problem BI1 E.N.

241 Problem E x x11/13/2007 Problem BJ1 E.N.

242 Problem M x x11/13/2007 Problem CC1 E.N.

243 Problem E x x 11/14/2007 E.N.

10-6


Problem CD1

244 Problem M x x11/14/2007 Problem DC1 E.N.

245 Problem E x x11/14/2007 Problem DD1 E.N.

246 Problem M x x11/12/2007 Problem AK1 E.N.

247 Problem M x x11/12/2007 Problem AL1 E.N.

248 Problem E x x11/12/2007 Problem AM1 E.N.

249 Problem M x x11/13/2007 Problem BK1 E.N.

250 Problem M x x11/13/2007 Problem BL1 E.N.

251 Problem E x x11/13/2007 Problem BM1 E.N.

252 Problem E x x11/14/2007 Problem CE1 E.N.

253 Problem E x x11/14/2007 Problem DE1 E.N.

254 Problem M x x x11/12/2007 Problem AQ1 E.N.

255 Problem M x x x11/13/2007 Problem BQ1 E.N.

256 Problem M x x11/12/2007 Problem AN1 E.N.

257 Problem M x x11/12/2007 Problem AO1 E.N.

258 Problem M x x11/12/2007 Problem AP1 E.N.

259 Problem M x x11/13/2007 Problem BN1 E.N.

260 Problem M x x11/13/2007 Problem BO1 E.N.

261 Problem M x x11/13/2007 Problem BP1 E.N.

262 Problem E x x 11/14/2007 E.N.

10-7


Problem CF1

263 Problem E x x11/14/2007 Problem DF1 E.N.

264 Problem E x9/22/2004 Problem A3 E.N.

265 Problem E x9/22/2004 Problem B3 E.N.

266 Problem E x11/12/2007 Problem AA1 E.N.

267 Problem E x11/12/2007 Problem AB1 E.N.

268 Problem E x11/12/2007 Problem AC1 E.N.

269 Problem E x11/12/2007 Problem AD1 E.N.

270 Problem E x11/12/2007 Problem AE1 E.N.

271 Problem E x11/12/2007 Problem AF1 E.N.

272 Problem E x11/12/2007 Problem BA1 E.N.

273 Problem E x11/12/2007 Problem BB1 E.N.

274 Problem E x11/12/2007 Problem BC1 E.N.

275 Problem E x11/12/2007 Problem BD1 E.N.

276 Problem E x11/12/2007 Problem BE1 E.N.

277 Problem E x11/12/2007 Problem BF1 E.N.

278 Problem E x11/13/2007 Problem CA1 E.N.

279 Problem E x11/13/2007 Problem CB1 E.N.

280 Problem E x11/14/2007 Problem DA1 E.N.

281 Problem E x 11/14/2007 E.N.

10-8


Problem DB1

282 Problem M x x11/14/2007 Problem EC1 E.N.

283 Problem H x x11/14/2007 Problem ED1 E.N.

284 Problem M x x11/14/2007 Problem FC1 E.N.

285 Problem H x x11/14/2007 Problem FD1 E.N.

286 Problem H x x11/14/2007 Problem EE1 E.N.

287 Problem H x x11/14/2007 Problem FE1 E.N.

288 Problem H x x11/14/2007 Problem EF1 E.N.

289 Problem H x x11/14/2007 Problem FF1 E.N.

290 Problem H x x11/14/2007 Problem FG1 E.N.

291 Problem M x11/14/2007 Problem EA1 E.N.

292 Problem M x11/14/2007 Problem EB1 E.N.

293 Problem M x11/14/2007 Problem FA1 E.N.

294 Problem M x11/14/2007 Problem FB1 E.N.

10-9


True / False Questions

1. The main difference between a flexible budget and a static budget is that a flexible budget does not contain fixed costs. True False

2. A problem with directly comparing a static planning budget to actual costs is that this comparison fails to distinguish between differences in costs that are due to changes in activity and differences that are due to how well costs were controlled. True False

3. A planning budget is prepared before the period begins and is valid for only the planned level of activity. True False

4. A flexible budget is an estimate of what revenues and costs should have been, given the level of activity that had been planned for the period. True False

5. An unfavorable activity variance for a cost indicates that spending was higher than it should have been for the actual level of activity for the period. True False

6. The activity variance for revenue is unfavorable if the actual revenue for the period is less than the revenue in the static planning budget. True False

10-10


7. The revenue and spending variances are the differences between the static planning budget and the flexible budget. True False

8. A revenue variance is unfavorable if the actual revenue is less than what the revenue should have been for the actual level of activity for the period. True False

9. When the activity measure is the number of units sold, the revenue variance is unfavorable if the average actual selling price is less than expected. True False

10. A favorable spending variance occurs when the actual cost is less than the amount of that cost in the flexible budget. True False

11. A flexible budget performance report should contain fixed as well as variable and mixed costs. True False

12. It may be easier to control fixed costs than variable costs. True False

13. A static planning budget is suitable for planning and for evaluating how well costs are controlled. True False

10-11


14. If the actual level of activity is 4% less than planned, then the costs in the static budget should be reduced by 4% before comparing them to actual costs. True False

15. If the actual level of activity is 4% more than planned, then the fixed costs in the static budget should be increased by 4% before comparing them to actual costs. True False

Multiple Choice Questions

16. A flexible budget: A. classifies budget requests by activity and estimates the benefits arising from each activity.B. presents a statement of expectations for a period of time but does not present a firm commitment.C. presents the plan for only one level of activity and does not adjust to changes in the level of activity.D. presents the plan for a range of activity so that the plan can be adjusted for changes in activity levels.

17. A flexible budget is a budget that: A. is updated with actual costs as they occur during the period.B. is updated to reflect the actual level of activity during the period.C. is prepared using a computer spreadsheet application.D. contains only variable production costs.

18. Which of the following comparisons best isolates the impact that changes in prices of inputs and outputs have on performance? A. static planning budget and flexible budgetB. static planning budget and actual resultsC. flexible budget and actual resultsD. master budget and static planning budget

10-12


19. Marchi Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below:

The Inn's variable overhead costs are driven by the number of guests. What would be the total budgeted overhead cost for a month if the activity level is 70 guests? A. $42,460.00B. $6,620.00C. $7,086.15D. $6,580.00

10-13


20. Barringer Manufacturing Corporation has prepared the following overhead budget for next month.

The company's variable overhead costs are driven by machine-hours. What would be the total budgeted overhead cost for next month if the activity level is 7,900 machine-hours rather than 7,800 machine-hours? A. $110,710.00B. $109,620.00C. $110,868.00D. $111,025.38

10-14


21. Placek Hospital bases its budgets on patient-visits. The hospital's static budget for October appears below:

The total overhead cost at an activity level of 7,700 patient-visits per month should be: A. $129,550B. $121,720C. $129,100D. $137,830

22. Dike Hotel bases its budgets on guest-days. The hotel's static budget for June appears below:

The total overhead cost at an activity level of 8,400 guest-days per month should be: A. $159,440B. $149,650C. $160,430D. $172,200

10-15


23. Blackwelder Snow Removal's cost formula for its vehicle operating cost is $1,240 per month plus $348 per snow-day. For the month of December, the company planned for activity of 12 snow-days, but the actual level of activity was 14 snow-days. The actual vehicle operating cost for the month was $6,330. The vehicle operating cost in the planning budget for December would be closest to: A. $5,426B. $6,112C. $5,416D. $6,330

24. Ofarrell Snow Removal's cost formula for its vehicle operating cost is $1,840 per month plus $377 per snow-day. For the month of November, the company planned for activity of 14 snow-days, but the actual level of activity was 19 snow-days. The actual vehicle operating cost for the month was $9,280. The vehicle operating cost in the flexible budget for November would be closest to: A. $9,003B. $7,118C. $9,280D. $9,660

25. Guilbault Midwifery's cost formula for its wages and salaries is $2,340 per month plus $154 per birth. For the month of June, the company planned for activity of 115 births, but the actual level of activity was 112 births. The actual wages and salaries for the month was $19,530. The wages and salaries in the planning budget for June would be closest to: A. $19,530B. $19,588C. $20,053D. $20,050

10-16


26. Dewberry Midwifery's cost formula for its wages and salaries is $1,960 per month plus $429 per birth. For the month of December, the company planned for activity of 128 births, but the actual level of activity was 130 births. The actual wages and salaries for the month was $56,020. The wages and salaries in the flexible budget for December would be closest to: A. $57,761B. $57,730C. $56,020D. $56,872

27. Entler Framing's cost formula for its supplies cost is $2,250 per month plus $16 per frame. For the month of June, the company planned for activity of 502 frames, but the actual level of activity was 497 frames. The actual supplies cost for the month was $10,580. The supplies cost in the planning budget for June would be closest to: A. $10,580B. $10,282C. $10,686D. $10,202

28. Rising Framing's cost formula for its supplies cost is $2,210 per month plus $10 per frame. For the month of January, the company planned for activity of 710 frames, but the actual level of activity was 705 frames. The actual supplies cost for the month was $9,500. The supplies cost in the flexible budget for January would be closest to: A. $9,260B. $9,244C. $9,500D. $9,310

10-17


29. Naval Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $430 per month plus $99 per job plus $10 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in March to be 12 jobs and 126 meals, but the actual activity was 9 jobs and 124 meals. The actual cost for catering supplies in March was $2,550. The catering supplies in the planning budget for March would be closest to: A. $3,400B. $2,561C. $2,550D. $2,878

30. Johannsen Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $310 per month plus $103 per job plus $23 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in February to be 28 jobs and 187 meals, but the actual activity was 26 jobs and 192 meals. The actual cost for catering supplies in February was $7,620. The catering supplies in the flexible budget for February would be closest to: A. $7,495B. $7,404C. $7,620D. $6,960

31. Venanzi Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $40,720 per month plus $2,646 per flight plus $11 per passenger. The company expected its activity in September to be 62 flights and 288 passengers, but the actual activity was 64 flights and 289 passengers. The actual cost for plane operating costs in September was $214,430. The activity variance for plane operating costs in September would be closest to: A. $6,490 UB. $5,303 FC. $6,490 FD. $5,303 U

10-18


32. Kimbril Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $530 per month plus $91 per job plus $12 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in January to be 27 jobs and 174 meals, but the actual activity was 31 jobs and 173 meals. The actual cost for catering supplies in January was $5,330. The activity variance for catering supplies in January would be closest to: A. $255 FB. $255 UC. $352 FD. $352 U

33. Portsche Snow Removal's cost formula for its vehicle operating cost is $2,310 per month plus $317 per snow-day. For the month of November, the company planned for activity of 18 snow-days, but the actual level of activity was 20 snow-days. The actual vehicle operating cost for the month was $8,730. The activity variance for vehicle operating cost in November would be closest to: A. $714 UB. $714 FC. $634 FD. $634 U

34. Reuer Midwifery's cost formula for its wages and salaries is $2,900 per month plus $475 per birth. For the month of March, the company planned for activity of 116 births, but the actual level of activity was 117 births. The actual wages and salaries for the month was $56,270. The activity variance for wages and salaries in March would be closest to: A. $1,730 UB. $475 FC. $475 UD. $1,730 F

10-19


35. Embertson Framing's cost formula for its supplies cost is $1,350 per month plus $16 per frame. For the month of June, the company planned for activity of 816 frames, but the actual level of activity was 812 frames. The actual supplies cost for the month was $14,680. The activity variance for supplies cost in June would be closest to: A. $64 UB. $274 UC. $64 FD. $274 F

36. Lapinsky Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $31,400 per month plus $2,148 per flight plus $7 per passenger. The company expected its activity in April to be 89 flights and 261 passengers, but the actual activity was 84 flights and 260 passengers. The actual cost for plane operating costs in April was $204,810. The spending variance for plane operating costs in April would be closest to: A. $8,842 UB. $19,589 FC. $19,589 UD. $8,842 F

37. Posson Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $210 per month plus $96 per job plus $20 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in March to be 20 jobs and 162 meals, but the actual activity was 17 jobs and 164 meals. The actual cost for catering supplies in March was $4,990. The spending variance for catering supplies in March would be closest to: A. $380 FB. $132 UC. $132 FD. $380 U

10-20


38. Dunklin Medical Clinic measures its activity in terms of patient-visits. Last month, the budgeted level of activity was 1,620 patient-visits and the actual level of activity was 1,540 patient-visits. The cost formula for administrative expenses is $3.20 per patient-visit plus $14,300 per month. The actual administrative expense was $21,050. In the clinic's flexible budget performance report for last month, the spending variance for administrative expenses was: A. $118 FB. $256 FC. $1,566 UD. $1,822 U

39. Brattain Tile Installation Corporation measures its activity in terms of square feet of tile installed. Last month, the budgeted level of activity was 1,230 square feet and the actual level of activity was 1,140 square feet. The company's owner budgets for supply costs, a variable cost, at $2.10 per square foot. The actual supply cost last month was $3,260. In the company's flexible budget performance report for last month, what would have been the spending variance for supply costs? A. $257 FB. $866 UC. $677 UD. $189 F

40. Cahalane Natural Dying Corporation measures its activity in terms of skeins of yarn dyed. Last month, the budgeted level of activity was 11,600 skeins and the actual level of activity was 12,000 skeins. The company's owner budgets for dye costs, a variable cost, at $0.31 per skein. The actual dye cost last month was $3,540. In the company's flexible budget performance report for last month, what would have been the spending variance for dye costs? A. $118 UB. $124 UC. $56 FD. $180 F

10-21


41. Gladstone Footwear Corporation's flexible budget cost formula for supplies, a variable cost, is $2.83 per unit of output. The company's flexible budget performance report for last month showed a $9,555 unfavorable spending variance for supplies. During that month, 19,500 units were produced. Budgeted activity for the month had been 19,300 units. The actual cost per unit for indirect materials must have been closest to: A. $3.32B. $3.81C. $2.83D. $3.85

42. Velten Corporation's flexible budget performance report for last month shows that actual indirect materials cost, a variable cost, was $45,198 and that the spending variance for indirect materials cost was $9,114 favorable. During that month, the company worked 18,600 machine-hours. Budgeted activity for the month had been 19,000 machine-hours. The cost formula per machine-hour for indirect materials cost must have been closest to: A. $1.90B. $2.86C. $1.94D. $2.92

43. Lesinski Snow Removal's cost formula for its vehicle operating cost is $1,770 per month plus $483 per snow-day. For the month of February, the company planned for activity of 19 snow-days, but the actual level of activity was 24 snow-days. The actual vehicle operating cost for the month was $13,070. The spending variance for vehicle operating cost in February would be closest to: A. $2,123 UB. $292 FC. $2,123 FD. $292 U

10-22


44. Harville Midwifery's cost formula for its wages and salaries is $1,610 per month plus $199 per birth. For the month of March, the company planned for activity of 118 births, but the actual level of activity was 122 births. The actual wages and salaries for the month was $25,430. The spending variance for wages and salaries in March would be closest to: A. $458 FB. $338 UC. $458 UD. $338 F

45. Olivier Framing's cost formula for its supplies cost is $2,870 per month plus $16 per frame. For the month of January, the company planned for activity of 533 frames, but the actual level of activity was 534 frames. The actual supplies cost for the month was $11,080. The spending variance for supplies cost in January would be closest to: A. $334 UB. $334 FC. $318 UD. $318 F

46. Elizarraras Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $39,820 per month plus $2,938 per flight plus $8 per passenger. The company expected its activity in June to be 64 flights and 229 passengers, but the actual activity was 66 flights and 225 passengers. The actual cost for plane operating costs in June was $234,570. The plane operating costs in the planning budget for June would be closest to: A. $229,684B. $227,462C. $234,570D. $235,528

10-23


47. Niforos Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $41,380 per month plus $2,282 per flight plus $14 per passenger. The company expected its activity in August to be 77 flights and 264 passengers, but the actual activity was 78 flights and 261 passengers. The actual cost for plane operating costs in August was $216,740. The plane operating costs in the flexible budget for August would be closest to: A. $220,790B. $223,030C. $223,657D. $216,740

Pollica Corporation's cost formula for its selling and administrative expense is $11,400 per month plus $94 per unit. For the month of March, the company planned for activity of 5,700 units, but the actual level of activity was 5,660 units. The actual selling and administrative expense for the month was $522,860.

48. The selling and administrative expense in the planning budget for March would be closest to: A. $522,860B. $547,200C. $543,440D. $526,555

49. The selling and administrative expense in the flexible budget for March would be closest to: A. $547,200B. $522,860C. $543,360D. $543,440

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50. The activity variance for selling and administrative expense in March would be closest to: A. $24,340 FB. $24,340 UC. $3,760 UD. $3,760 F

51. The spending variance for selling and administrative expense in March would be closest to: A. $20,580 FB. $24,340 UC. $24,340 FD. $20,580 U

Kuczenski Corporation's cost formula for its manufacturing overhead is $45,700 per month plus $53 per machine-hour. For the month of March, the company planned for activity of 6,200 machine-hours, but the actual level of activity was 6,150 machine-hours. The actual manufacturing overhead for the month was $373,630.

52. The manufacturing overhead in the planning budget for March would be closest to: A. $373,630B. $371,650C. $376,668D. $374,300

53. The manufacturing overhead in the flexible budget for March would be closest to: A. $371,650B. $371,281C. $373,630D. $374,300

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54. The activity variance for manufacturing overhead in March would be closest to: A. $670 UB. $670 FC. $2,650 FD. $2,650 U

55. The spending variance for manufacturing overhead in March would be closest to: A. $670 FB. $1,980 UC. $1,980 FD. $670 U

Kaaihue Detailing's cost formula for its materials and supplies is $2,750 per month plus $17 per vehicle. For the month of April, the company planned for activity of 95 vehicles, but the actual level of activity was 135 vehicles. The actual materials and supplies for the month was $4,850.

56. The materials and supplies in the planning budget for April would be closest to: A. $4,850B. $5,045C. $3,413D. $4,365

57. The materials and supplies in the flexible budget for April would be closest to: A. $6,203B. $4,850C. $4,365D. $5,045

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58. The activity variance for materials and supplies in April would be closest to: A. $680 UB. $485 FC. $680 FD. $485 U

59. The spending variance for materials and supplies in April would be closest to: A. $195 FB. $485 FC. $195 UD. $485 U

Deleston Boat Wash's cost formula for its cleaning equipment and supplies is $2,150 per month plus $21 per boat. For the month of September, the company planned for activity of 79 boats, but the actual level of activity was 39 boats. The actual cleaning equipment and supplies for the month was $3,110.

60. The cleaning equipment and supplies in the planning budget for September would be closest to: A. $3,110B. $6,300C. $2,969D. $3,809

61. The cleaning equipment and supplies in the flexible budget for September would be closest to: A. $1,880B. $3,110C. $3,809D. $2,969

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62. The activity variance for cleaning equipment and supplies in September would be closest to: A. $840 FB. $699 FC. $699 UD. $840 U

63. The spending variance for cleaning equipment and supplies in September would be closest to: A. $699 FB. $699 UC. $141 FD. $141 U

Werber Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 2,700 client-visits, but its actual level of activity was 2,730 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

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64. The activity variance for personnel expenses in January would be closest to: A. $661 UB. $261 UC. $261 FD. $661 F

65. The activity variance for administrative expenses in January would be closest to: A. $12 FB. $8 FC. $12 UD. $8 U

66. The activity variance for net operating income in January would be closest to: A. $2,019 UB. $2,019 FC. $489 FD. $489 U

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Feiner Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,220 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:

67. The activity variance for personnel expenses in December would be closest to: A. $4,024 FB. $466 FC. $466 UD. $4,024 U

68. The activity variance for administrative expenses in December would be closest to: A. $8 FB. $162 FC. $162 UD. $8 U

69. The activity variance for net operating income in December would be closest to: A. $690 UB. $9,670 UC. $690 FD. $9,670 F

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Grundhoefer Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During April, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 1,990 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for April:

70. The activity variance for wages and salaries in April would be closest to: A. $66 FB. $564 UC. $564 FD. $66 U

71. The activity variance for administrative expenses in April would be closest to: A. $1 FB. $79 FC. $79 UD. $1 U

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72. The activity variance for net operating income in April would be closest to: A. $141 UB. $2,651 UC. $2,651 FD. $141 F

Gorley Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 3,900 tenant-days, but its actual level of activity was 3,940 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

73. The activity variance for wages and salaries in February would be closest to: A. $1,152 UB. $1,152 FC. $292 UD. $292 F

74. The activity variance for administrative expenses in February would be closest to: A. $18 UB. $12 UC. $18 FD. $12 F

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75. The activity variance for net operating income in February would be closest to: A. $368 FB. $368 UC. $632 FD. $632 U

Enriques Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 5,000 units, but its actual level of activity was 4,990 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for February:

76. The activity variance for direct labor in February would be closest to: A. $61 UB. $1,081 UC. $61 FD. $1,081 F

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77. The activity variance for selling and administrative expenses in February would be closest to: A. $1,308 FB. $1,308 UC. $2 UD. $2 F

78. The activity variance for net operating income in February would be closest to: A. $2,716 FB. $2,716 UC. $176 UD. $176 F

Palczewski Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During December, the company budgeted for 5,000 units, but its actual level of activity was 4,980 units. The company has provided the following data concerning the formulas to be used in its budgeting:

79. The activity variance for direct labor in December would be closest to: A. $180 UB. $70 FC. $70 UD. $180 F

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80. The activity variance for selling and administrative expenses in December would be closest to: A. $14 UB. $14 FC. $1,206 FD. $1,206 U

81. The activity variance for net operating income in December would be closest to: A. $2,372 UB. $328 FC. $2,372 FD. $328 U

Burget Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,110 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:

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82. The revenue variance for July would be closest to: A. $2,581 FB. $2,110 UC. $2,110 FD. $2,581 U

83. The spending variance for medical supplies in July would be closest to: A. $580 UB. $645 UC. $645 FD. $580 F

84. The spending variance for occupancy expenses in July would be closest to: A. $265 FB. $280 UC. $280 FD. $265 U

85. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for July would be closest to: A. $4,508 FB. $4,290 UC. $4,290 FD. $4,508 U

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Razor Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During November, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 3,010 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for November:

86. The revenue variance for November would be closest to: A. $1,607 UB. $1,910 UC. $1,607 FD. $1,910 F

87. The spending variance for expendables in November would be closest to: A. $240 FB. $354 FC. $240 UD. $354 U

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88. The spending variance for facility expenses in November would be closest to: A. $416 UB. $416 FC. $390 FD. $390 U

89. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for November would be closest to: A. $3,520 FB. $3,428 UC. $3,520 UD. $3,428 F

Vandall Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,300 units, but its actual level of activity was 7,340 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April:

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90. The revenue variance for April would be closest to: A. $4,274 FB. $5,690 FC. $5,690 UD. $4,274 U

91. The spending variance for direct materials in April would be closest to: A. $210 UB. $210 FC. $426 UD. $426 F

92. The spending variance for manufacturing overhead in April would be closest to: A. $1,600 UB. $1,648 FC. $1,600 FD. $1,648 U

93. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for April would be closest to: A. $6,144 FB. $6,740 UC. $6,740 FD. $6,144 U

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Moorhouse Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,690 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December:

94. The personnel expenses in the planning budget for December would be closest to: A. $51,009B. $51,147C. $53,370D. $53,299

95. The medical supplies in the flexible budget for December would be closest to: A. $18,150B. $17,472C. $17,378D. $18,105

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96. The activity variance for personnel expenses in December would be closest to: A. $2,361 UB. $71 UC. $71 FD. $2,361 F

97. The revenue variance for December would be closest to: A. $3,680 UB. $3,429 FC. $3,429 UD. $3,680 F

98. The spending variance for medical supplies in December would be closest to: A. $680 FB. $680 UC. $725 UD. $725 F

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Cotty Clinic uses client-visits as its measure of activity. During March, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,970 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for March:

99. The administrative expenses in the planning budget for March would be closest to: A. $6,288B. $6,300C. $6,418D. $6,483

100. The occupancy expenses in the flexible budget for March would be closest to: A. $13,400B. $12,770C. $13,349D. $13,029

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101. The activity variance for administrative expenses in March would be closest to: A. $118 UB. $12 FC. $118 FD. $12 U

102. The spending variance for medical supplies in March would be closest to: A. $1,050 UB. $1,050 FC. $1,263 FD. $1,263 U

Murphree Clinic uses client-visits as its measure of activity. During April, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,350 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for April:

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103. The net operating income in the planning budget for April would be closest to: A. $14,425B. $19,519C. $13,550D. $20,115

104. The net operating income in the flexible budget for April would be closest to: A. $20,115B. $19,519C. $14,425D. $13,550

105. The activity variance for net operating income in April would be closest to: A. $875 FB. $6,265 FC. $875 UD. $6,265 U

106. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for April would be closest to: A. $5,390 FB. $6,265 UC. $5,390 UD. $6,265 F

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Henkel Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 3,600 client-visits, but its actual level of activity was 3,550 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for November:

107. The personnel expenses in the planning budget for November would be closest to: A. $74,120B. $71,432C. $70,440D. $74,640

108. The occupancy expenses in the flexible budget for November would be closest to: A. $14,422B. $14,831C. $15,325D. $15,400

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109. The activity variance for administrative expenses in November would be closest to: A. $215 UB. $215 FC. $5 FD. $5 U

110. The spending variance for occupancy expenses in November would be closest to: A. $775 UB. $700 FC. $775 FD. $700 U

Hoeper Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 2,600 client-visits, but its actual level of activity was 2,570 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

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111. The administrative expenses in the planning budget for January would be closest to: A. $5,047B. $4,960C. $5,106D. $4,957

112. The medical supplies in the flexible budget for January would be closest to: A. $19,733B. $18,932C. $19,940D. $19,377

113. The activity variance for personnel expenses in January would be closest to: A. $1,416 UB. $486 FC. $1,416 FD. $486 U

114. The spending variance for medical supplies in January would be closest to: A. $787 FB. $787 UC. $580 FD. $580 U

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Legard Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During January, the kennel budgeted for 2,600 tenant-days, but its actual level of activity was 2,620 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for January:

115. The wages and salaries in the planning budget for January would be closest to: A. $24,040B. $23,755C. $23,938D. $24,198

116. The expendables in the flexible budget for January would be closest to: A. $35,946B. $36,704C. $35,680D. $37,271

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117. The activity variance for wages and salaries in January would be closest to: A. $158 FB. $158 UC. $102 UD. $102 F

118. The revenue variance for January would be closest to: A. $750 UB. $40 UC. $40 FD. $750 F

119. The spending variance for expendables in January would be closest to: A. $1,040 FB. $1,306 FC. $1,040 UD. $1,306 U

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Drabant Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,040 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

120. The administrative expenses in the planning budget for February would be closest to: A. $7,500B. $7,252C. $7,110D. $7,512

121. The facility expenses in the flexible budget for February would be closest to: A. $13,700B. $13,401C. $13,788D. $12,880

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122. The activity variance for administrative expenses in February would be closest to: A. $248 UB. $248 FC. $12 UD. $12 F

123. The spending variance for expendables in February would be closest to: A. $836 FB. $1,360 FC. $836 UD. $1,360 U

Tosta Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 2,100 tenant-days, but its actual level of activity was 2,050 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:

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124. The net operating income in the planning budget for May would be closest to: A. $9,140B. $11,626C. $12,200D. $8,420

125. The net operating income in the flexible budget for May would be closest to: A. $9,140B. $8,420C. $11,626D. $12,200

126. The activity variance for net operating income in May would be closest to: A. $2,770 UB. $720 UC. $720 FD. $2,770 F

127. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for May would be closest to: A. $3,490 FB. $2,770 FC. $3,490 UD. $2,770 U

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Stent Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,950 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

128. The wages and salaries in the planning budget for February would be closest to: A. $22,670B. $24,183C. $23,780D. $23,000


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131. The spending variance for facility expenses in February would be closest to: A. $130 UB. $130 FC. $5 UD. $5 F

Rippelmeyer Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During June, the kennel budgeted for 3,600 tenant-days, but its actual level of activity was 3,550 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for June:

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132. The administrative expenses in the planning budget for June would be closest to: A. $7,996B. $7,885C. $7,555D. $7,560

133. The expendables in the flexible budget for June would be closest to: A. $33,666B. $34,270C. $34,740D. $34,621

134. The activity variance for wages and salaries in June would be closest to: A. $310 FB. $110 FC. $310 UD. $110 U

135. The spending variance for expendables in June would be closest to: A. $130 FB. $600 UC. $130 UD. $600 F

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Baugus Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 6,900 units, but its actual level of activity was 6,950 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:

136. The direct labor in the planning budget for August would be closest to: A. $27,760B. $29,190C. $27,560D. $28,980

137. The direct materials in the flexible budget for August would be closest to: A. $127,650B. $128,575C. $127,581D. $129,436

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138. The activity variance for direct labor in August would be closest to: A. $1,220 FB. $210 UC. $210 FD. $1,220 U

139. The revenue variance for August would be closest to: A. $1,450 FB. $1,450 UC. $430 FD. $430 U

140. The spending variance for direct materials in August would be closest to: A. $70 FB. $855 UC. $70 UD. $855 F

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Lampert Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 6,100 units, but its actual level of activity was 6,060 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for March:

141. The selling and administrative expenses in the planning budget for March would be closest to: A. $26,560B. $27,647C. $27,466D. $26,536


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143. The activity variance for selling and administrative expenses in March would be closest to: A. $906 UB. $906 FC. $24 UD. $24 F

144. The spending variance for direct materials in March would be closest to: A. $900 FB. $900 UC. $1,376 UD. $1,376 F

Woofter Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,600 units, but its actual level of activity was 7,560 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January:

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145. The net operating income in the planning budget for January would be closest to: A. $16,410B. $16,238C. $28,604D. $29,140

146. The net operating income in the flexible budget for January would be closest to: A. $28,604B. $16,238C. $16,410D. $29,140

147. The activity variance for net operating income in January would be closest to: A. $12,816 FB. $12,816 UC. $536 FD. $536 U

148. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for January would be closest to: A. $12,816 FB. $12,280 UC. $12,816 UD. $12,280 F

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Buffaloe Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 5,200 units, but its actual level of activity was 5,250 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:


150. The manufacturing overhead in the flexible budget for August would be closest to: A. $53,919B. $55,525C. $52,896D. $55,460

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151. The activity variance for selling and administrative expenses in August would be closest to: A. $690 FB. $690 UC. $20 FD. $20 U

152. The spending variance for manufacturing overhead in August would be closest to: A. $2,055 FB. $2,055 UC. $2,120 UD. $2,120 F

Luc Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 5,000 units, but its actual level of activity was 4,950 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for February:

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153. The selling and administrative expenses in the planning budget for February would be closest to: A. $30,490B. $30,495C. $30,500D. $30,190

154. The direct materials in the flexible budget for February would be closest to: A. $91,575B. $95,985C. $92,500D. $94,075

155. The activity variance for direct labor in February would be closest to: A. $340 UB. $760 FC. $340 FD. $760 U

156. The spending variance for direct materials in February would be closest to: A. $3,450 FB. $2,525 UC. $3,450 UD. $2,525 F

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Worden Hospital bases its budgets on patient-visits. The hospital's static budget for February appears below:

157. The total variable cost at the activity level of 4,400 patient-visits per month should be: A. $85,140B. $87,120C. $65,120D. $63,640

158. The total fixed cost at the activity level of 4,700 patient-visits per month should be: A. $162,620B. $148,780C. $93,060D. $85,140

159. The total cost at the activity level of 4,600 patient-visits per month should be: A. $153,720B. $148,780C. $153,220D. $159,160

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Dwelmont Hotel bases its budgets on guest-days. The hotel's static budget for May appears below:

160. The total variable cost at the activity level of 2,600 guest-days per month should be: A. $36,920B. $32,660C. $45,540D. $51,480

161. The total fixed cost at the activity level of 2,900 guest-days per month should be: A. $78,200B. $57,420C. $98,600D. $45,540

162. The total cost at the activity level of 2,800 guest-days per month should be: A. $95,200B. $86,230C. $85,300D. $78,200

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Springmeyer Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 2,900 client-visits, but its actual level of activity was 2,940 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:

163. The personnel expenses in the planning budget for August would be closest to: A. $69,600B. $73,800C. $70,560D. $73,200

164. The administrative expenses in the planning budget for August would be closest to: A. $7,594B. $7,590C. $7,165D. $7,264

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165. The net operating income in the planning budget for August would be closest to: A. $15,416B. $11,878C. $11,557D. $14,560

Weisgarber Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for August:



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Smithson Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,270 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for May:

169. The medical supplies in the flexible budget for May would be closest to: A. $14,907B. $15,488C. $15,207D. $15,030

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170. The occupancy expenses in the flexible budget for May would be closest to: A. $14,334B. $13,840C. $13,786D. $14,599


Mah Clinic uses client-visits as its measure of activity. During April, the clinic budgeted for 3,800 client-visits, but its actual level of activity was 3,750 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:

172. The medical supplies in the flexible budget for April would be closest to: A. $21,340B. $22,600C. $22,325D. $21,913

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173. The occupancy expenses in the flexible budget for April would be closest to: A. $15,575B. $15,660C. $14,975D. $15,377


Lauser Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,690 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:

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175. The personnel expenses in the planning budget for July would be closest to: A. $54,730B. $54,641C. $52,341D. $52,483

176. The occupancy expenses in the flexible budget for July would be closest to: A. $12,466B. $12,991C. $12,921D. $12,480

177. The net operating income in the flexible budget for July would be closest to: A. $17,215B. $17,122C. $11,140D. $11,018

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Higgenbotham Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,600 client-visits, but its actual level of activity was 3,580 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for May:

178. The administrative expenses in the planning budget for May would be closest to: A. $5,261B. $5,440C. $5,232D. $5,432



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Jauron Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During September, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,310 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for September:

181. The wages and salaries in the planning budget for September would be closest to: A. $13,741B. $13,682C. $13,781D. $13,730

182. The administrative expenses in the planning budget for September would be closest to: A. $7,362B. $7,181C. $7,360D. $7,212

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183. The net operating income in the planning budget for September would be closest to: A. $10,772B. $6,979C. $10,866D. $6,870

Lutts Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During November, the kennel budgeted for 3,800 tenant-days, but its actual level of activity was 3,850 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

184. The wages and salaries in the planning budget for November would be closest to: A. $27,610B. $27,280C. $28,238D. $28,610

185. The administrative expenses in the planning budget for November would be closest to: A. $7,310B. $7,520C. $7,540D. $7,215

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186. The net operating income in the planning budget for November would be closest to: A. $12,720B. $9,648C. $9,904D. $13,115

Swader Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 2,900 tenant-days, but its actual level of activity was 2,930 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March:

187. The expendables in the flexible budget for March would be closest to: A. $25,905B. $25,650C. $27,274D. $26,719

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188. The facility expenses in the flexible budget for March would be closest to: A. $20,700B. $20,369C. $20,793D. $20,820

189. The net operating income in the flexible budget for March would be closest to: A. $12,522B. $12,267C. $9,414D. $9,120

Whetstine Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During September, the kennel budgeted for 3,200 tenant-days, but its actual level of activity was 3,180 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

190. The expendables in the flexible budget for September would be closest to: A. $27,630B. $27,864C. $27,517D. $27,800

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191. The facility expenses in the flexible budget for September would be closest to: A. $21,320B. $21,238C. $21,513D. $21,784

192. The net operating income in the flexible budget for September would be closest to: A. $8,548B. $4,967C. $5,029D. $8,720

Kalinowski Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,320 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

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195. The net operating income in the flexible budget for February would be closest to: A. $10,370B. $10,608C. $7,642D. $7,775

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Laboe Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,900 tenant-days, but its actual level of activity was 2,940 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:


197. The net operating income in the planning budget for February would be closest to: A. $7,191B. $7,391C. $7,900D. $8,260

198. The expendables in the flexible budget for February would be closest to: A. $26,990B. $27,354C. $27,021D. $27,772

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Dantuono Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During November, the company budgeted for 7,700 units, but its actual level of activity was 7,720 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for November:

199. The direct labor in the planning budget for November would be closest to: A. $44,004B. $42,744C. $42,633D. $43,890

200. The selling and administrative expenses in the planning budget for November would be closest to: A. $30,490B. $29,974C. $30,504D. $29,896

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Menson Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During December, the company budgeted for 5,800 units, but its actual level of activity was 5,830 units. The company has provided the following data concerning the formulas to be used in its budgeting:

202. The direct labor in the planning budget for December would be closest to: A. $46,057B. $45,820C. $43,927D. $43,701

203. The selling and administrative expenses in the planning budget for December would be closest to: A. $24,898B. $24,880C. $23,988D. $23,865

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204. The net operating income in the planning budget for December would be closest to: A. $19,788B. $24,979C. $19,380D. $25,238

Nasson Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 6,700 units, but its actual level of activity was 6,730 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:


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207. The net operating income in the flexible budget for August would be closest to: A. $22,506B. $18,317C. $17,930D. $22,708

Poulsen Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,300 units, but its actual level of activity was 7,270 units. The company has provided the following data concerning the formulas to be used in its budgeting:

208. The direct materials in the flexible budget for July would be closest to: A. $68,338B. $70,298C. $68,620D. $70,879

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209. The manufacturing overhead in the flexible budget for July would be closest to: A. $47,190B. $47,151C. $45,344D. $45,719


Witherington Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 7,800 units, but its actual level of activity was 7,850 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June:

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211. The direct labor in the planning budget for June would be closest to: A. $32,970B. $32,760C. $34,310D. $34,091

212. The manufacturing overhead in the flexible budget for June would be closest to: A. $57,435B. $54,794C. $57,380D. $55,498

213. The net operating income in the flexible budget for June would be closest to: A. $34,017B. $33,585C. $29,520D. $30,190

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Manago Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 5,300 units, but its actual level of activity was 5,310 units. The company has provided the following data concerning the formulas to be used in its budgeting:|


215. The net operating income in the planning budget for March would be closest to: A. $11,705B. $21,877C. $21,710D. $11,749

216. The direct materials in the flexible budget for March would be closest to: A. $73,278B. $73,929C. $73,140D. $74,208

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Bessey Hospital bases its budgets on patient-visits. The hospital's static planning budget for January appears below:

217. The spending variance for supplies costs in the flexible budget performance report for the month is: A. $4,180 FB. $4,180 UC. $2,560 FD. $2,560 U

218. The spending variance for laundry costs in the flexible budget performance report for the month is: A. $730 FB. $2,470 FC. $730 UD. $2,470 U

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219. The spending variance for occupancy costs in the flexible budget performance report for the month is: A. $330 FB. $2,090 FC. $330 UD. $2,090 U

Salling Corporation bases its budgets on machine-hours. The company's static planning budget for May appears below:

220. The spending variance for supplies costs in the flexible budget performance report for the month should be: A. $1,340 UB. $1,340 FC. $460 UD. $460 F

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221. The spending variance for power costs in the flexible budget performance report for the month should be: A. $310 UB. $310 FC. $820 UD. $820 F

222. The spending variance for equipment depreciation in the flexible budget performance report for the month should be: A. $540 FB. $10 FC. $10 UD. $540 U

Genito Corporation's static planning budget for October appears below. The company bases its budgets on machine-hours.

In October, the actual number of machine-hours was 8,800, the actual supplies cost was $69,450, the actual power cost was $34,190, the actual salaries cost was $86,490, and the actual equipment depreciation was $37,600.

223. The spending variance for supplies cost in the flexible budget performance report for the month should be: A. $4,500 FB. $7,110 FC. $7,110 UD. $4,500 U

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224. The spending variance for power cost in the flexible budget performance report for the month should be: A. $1,510 FB. $2,770 UC. $1,510 UD. $2,770 F

225. The spending variance for equipment depreciation in the flexible budget performance report for the month should be: A. $200 UB. $1,120 FC. $200 FD. $1,120 U

Lauter Printing uses two measures of activity, press runs and book set-ups, in the cost formulas in its budgets and performance reports. The cost formula for wages and salaries is $5,300 per month plus $480 per press run plus $1,080 per book set-up. The company expected its activity in October to be 169 press runs and 64 book set-ups, but the actual activity was 167 press runs and 60 book set-ups. The actual cost for wages and salaries in October was $155,690.

226. The wages and salaries in the planning budget for October would be closest to: A. $157,555B. $155,690C. $150,260D. $155,540

227. The wages and salaries in the flexible budget for October would be closest to: A. $155,540B. $155,690C. $150,260D. $153,699

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228. The activity variance for wages and salaries in October would be closest to: A. $5,280 UB. $150 UC. $150 FD. $5,280 F

229. The spending variance for wages and salaries in October would be closest to: A. $5,430 UB. $150 UC. $5,430 FD. $150 F

Spraque Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $40,520 per month plus $2,733 per flight plus $11 per passenger. The company expected its activity in June to be 71 flights and 207 passengers, but the actual activity was 70 flights and 205 passengers. The actual cost for plane operating costs in June was $239,580.

230. The plane operating costs in the planning budget for June would be closest to: A. $239,580B. $236,840C. $234,085D. $243,003

231. The plane operating costs in the flexible budget for June would be closest to: A. $233,504B. $234,085C. $239,580D. $236,840

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232. The activity variance for plane operating costs in June would be closest to: A. $2,755 UB. $2,755 FC. $2,740 FD. $2,740 U

233. The spending variance for plane operating costs in June would be closest to: A. $2,740 UB. $5,495 UC. $5,495 FD. $2,740 F

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Essay Questions

234. Immen Corporation bases its budgets on the activity measure customers served. During May, the company planned to serve 38,000 customers. The company has provided the following data concerning the formulas its uses in its budgeting:

The company has also furnished its income statement for May:

Required:

Prepare a report showing the company's activity variances for May. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

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235. Faggs Corporation bases its budgets on the activity measure customers served. During December, the company planned to serve 33,000 customers, but actually served 36,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare a report showing the company's activity variances for December. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

10-94


236. Brynteson Corporation bases its budgets on the activity measure customers served. During September, the company planned to serve 24,000 customers, but actually served 19,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $2.90qWages and salaries: $24,700 + $0.90qSupplies: $0.40qInsurance: $4,900Miscellaneous: $2,800 + $0.10q

Required:

Prepare a report showing the company's activity variances for September. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

237. Domin Corporation bases its budgets on the activity measure customers served. During April, the company planned to serve 31,000 customers, but actually served 35,000 customers. Revenue is $4.80 per customer served. Wages and salaries are $33,000 per month plus $1.60 per customer served. Supplies are $1.00 per customer served. Insurance is $12,200 per month. Miscellaneous expenses are $7,400 per month plus $0.20 per customer served.

Required:

Prepare a report showing the company's activity variances for April. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

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238. Fasano Clinic bases its budgets on the activity measure patient-visits. During April, the clinic planned for 3,800 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

The clinic has also furnished its income statement for April:

Required:

Prepare a report showing the clinic's activity variances for April.

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239. Mulvehill Clinic bases its budgets on the activity measure patient-visits. During June, the clinic planned for 3,000 patient-visits, but the actual level of activity was 3,400 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare a report showing the clinic's activity variances for June. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

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240. Mccarter Clinic bases its budgets on the activity measure patient-visits. During April, the clinic planned for 2,700 patient-visits, but its actual level of activity was 2,400 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare a report showing the clinic's activity variances for April. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

241. Delamarter Clinic bases its budgets on the activity measure patient-visits. During June, the clinic planned for 2,600 patient-visits, but its actual level of activity was 3,100 patient-visits. Revenue should be $53.40 per patient-visit. Personnel expenses should be $39,700 per month plus $12.60 per patient-visit. Medical supplies should be $1,800 per month plus $10.40 per patient-visit. Occupancy expenses should be $8,200 per month plus $2.30 per patient-visit. Administrative expenses should be $6,100 per month plus $0.20 per patient-visit.

Required:


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242. Alicuben Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for October was based on 2,200 meals, but the diner actually served 2,000 meals. The diner's director has provided the following cost formulas to use in budgets:

The director has also provided the diner's statement of actual expenses for the month:

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for October. Label each variance as favorable (F) or unfavorable (U).

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243. Aslanian Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for November was based on 2,200 meals, but the diner actually served 2,700 meals. The diner's director has provided the following cost formulas to use in budgets:

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for November. Label each variance as favorable (F) or unfavorable (U). Label each variance as favorable (F) or unfavorable (U).

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244. Mulry Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for September was based on 3,000 meals, but the diner actually served 2,800 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.45 per meal; kitchen operations, $4,900 per month plus $1.65 per meal; administrative expenses, $3,600 per month plus $0.60 per meal; and fundraising expenses, $1,200 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for September.

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245. Flicker Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for December was based on 2,400 meals, but the diner actually served 2,300 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.00 per meal; kitchen operations, $5,100 per month plus $1.85 per meal; administrative expenses, $2,900 per month plus $0.65 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for December. Label each variance as favorable (F) or unfavorable (U).

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246. Lakey Corporation uses customers served as its measure of activity. During July, the company budgeted for 33,000 customers, but actually served 34,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July:

Required:

Prepare a report showing the company's revenue and spending variances for July. Label each variance as favorable (F) or unfavorable (U).

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247. Mieras Corporation uses customers served as its measure of activity. During January, the company budgeted for 37,000 customers, but actually served 36,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:

Revenue: $2.80qWages and salaries: $22,800 + $0.90qSupplies: $0.50qInsurance: $7,500Miscellaneous: $3,800 + $0.30q

The company reported the following actual results for January:

Required:

Prepare a report showing the company's revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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248. Fuquay Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $4.80 per customer served. Wages and salaries should be $26,500 per month plus $1.70 per customer served. Supplies should be $0.90 per customer served. Insurance should be $7,100 per month. Miscellaneous expenses should be $4,700 per month plus $0.20 per customer served.

The company reported the following actual results for May:

Required:

Prepare a report showing the company's revenue and spending variances for May. Label each variance as favorable (F) or unfavorable (U).

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249. Kary Clinic uses patient-visits as its measure of activity. During May, the clinic budgeted for 3,800 patient-visits, but its actual level of activity was 4,100 patient-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for May:

Required:

Prepare a report showing the clinic's revenue and spending variances for May. Label each variance as favorable (F) or unfavorable (U).

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250. Gasco Clinic uses patient-visits as its measure of activity. During August, the clinic budgeted for 2,000 patient-visits, but its actual level of activity was 2,100 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:

Revenue: $62.90qPersonnel expenses: $28,500 + $20.40qMedical supplies: $1,400 + $9.90qOccupancy expenses: $8,200 + $3.30qAdministrative expenses: $4,000 + $0.40q

The clinic reported the following actual results for August:

Required:

Prepare a report showing the clinic's revenue and spending variances for August. Label each variance as favorable (F) or unfavorable (U).

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251. Braseth Clinic uses patient-visits as its measure of activity. The clinic bases its budgets on the following information: Revenue should be $39.90 per patient-visit. Personnel expenses should be $35,400 per month plus $13.00 per patient-visit. Medical supplies should be $1,100 per month plus $4.90 per patient-visit. Occupancy expenses should be $8,400 per month plus $2.00 per patient-visit. Administrative expenses should be $4,700 per month plus $0.20 per patient-visit.

The clinic reported the following actual results for January:

Required:

Prepare a report showing the clinic's revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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252. Villella Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for October was based on 3,800 meals. The diner's director has provided the following cost formulas to use in budgets:


Required:

Prepare a report showing the spending variances for each of the expenses and for total expenses for October. Label each variance as favorable (F) or unfavorable (U).

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253. Garing Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for March was based on 3,600 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.20 per meal; kitchen operations, $4,300 per month plus $1.90 per meal; administrative expenses, $3,300 per month plus $0.20 per meal; and fundraising expenses, $1,000 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:

Prepare a report showing the diner's spending variances for each of the expenses and for total expenses for March. Label each variance as favorable (F) or unfavorable (U).

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254. Legorreta Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of November:

Required:

Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

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255. Duell Clinic uses patient-visits as its measure of activity. The following report compares the planning budget to the actual operating results for the month of January:

Required:

Prepare the clinic's flexible budget performance report for January. Label each variance as favorable (F) or unfavorable (U).

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256. Squillace Corporation uses customers served as its measure of activity. During October, the company budgeted for 38,000 customers, but actually served 35,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October:

Required:

Prepare the company's flexible budget performance report for October. Label each variance as favorable (F) or unfavorable (U).

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257. Guy Corporation uses customers served as its measure of activity. During January, the company budgeted for 32,000 customers, but actually served 35,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:



Required:

Prepare the company's flexible budget performance report for January. Label each variance as favorable (F) or unfavorable (U).

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258. Cotillo Corporation uses customers served as its measure of activity. During December, the company budgeted for 29,000 customers, but actually served 27,000 customers. The company bases its budgets on the following information: Revenue should be $4.40 per customer served. Wages and salaries should be $33,300 per month plus $1.80 per customer served. Supplies should be $0.60 per customer served. Insurance should be $8,900 per month. Miscellaneous expenses should be $4,600 per month plus $0.10 per customer served. The company reported the following actual results for December:

Required:

Prepare the company's flexible budget performance report for December. Label each variance as favorable (F) or unfavorable (U).

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259. Thews Clinic uses patient-visits as its measure of activity. During August, the clinic budgeted for 2,000 patient-visits, but its actual level of activity was 2,200 patient-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:

Required:

Prepare the clinic's flexible budget performance report for August. Label each variance as favorable (F) or unfavorable (U).

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260. Mcgannon Clinic uses patient-visits as its measure of activity. During November, the clinic budgeted for 3,700 patient-visits, but its actual level of activity was 4,100 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:

Revenue: $23.90qPersonnel expenses: $20,800 + $7.90qMedical supplies: $800 + $3.50qOccupancy expenses: $6,100 + $1.30qAdministrative expenses: $3,100 + $0.10q

The clinic reported the following actual results for November:

Required:

Prepare the clinic's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

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261. Vernon Clinic uses patient-visits as its measure of activity. During February, the clinic budgeted for 3,100 patient-visits, but its actual level of activity was 2,800 patient-visits. The clinic bases its budgets on the following information: Revenue should be $30.20 per patient-visit. Personnel expenses should be $20,600 per month plus $9.70 per patient-visit. Medical supplies should be $1,400 per month plus $5.40 per patient-visit. Occupancy expenses should be $5,700 per month plus $1.50 per patient-visit. Administrative expenses should be $2,500 per month plus $0.30 per patient-visit. The clinic reported the following actual results for February:

Required:

Prepare the clinic's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U).

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262. Gamon Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for April was based on 3,600 meals. The diner's director has provided the following cost formulas to use in budgets:


Required:

Prepare a flexible budget performance report showing both the activity variances and the spending variances for each of the expenses and for total expenses for April. Label each variance as favorable (F) or unfavorable (U).

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263. Wrape Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for April was based on 2,100 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.55 per meal; kitchen operations, $4,700 per month plus $1.70 per meal; administrative expenses, $3,300 per month plus $0.60 per meal; and fundraising expenses, $1,000 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:


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264. Hausman Hospital bases its budgets on patient-visits. The hospital's static planning budget for October appears below:

Required:

Prepare a flexible budget for 8,900 patient-visits per month.

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265. Turiano Corporation bases its budgets on machine-hours. The company's static planning budget for November appears below:

Required:

Prepare a flexible budget for 9,800 machine-hours per month.

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266. Therrien Corporation bases its budgets on the activity measure customers served. During September, the company plans to serve 30,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the company's planning budget for September.

267. During March, Holston Corporation plans to serve 31,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:


Required:

Prepare the company's planning budget for March.

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268. During August, Klinck Corporation plans to serve 33,000 customers. Revenue is $2.50 per customer served. Wages and salaries are $24,300 per month plus $0.90 per customer served. Supplies are $0.30 per customer served. Insurance is $7,100 per month. Miscellaneous expenses are $5,200 per month plus $0.10 per customer served.

Required:

Prepare the company's planning budget for August.

269. Novielli Corporation bases its budgets on the activity measure customers served. During November, the company planned to serve 39,000 customers, but actually served 44,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the company's flexible budget for November based on the actual level of activity for the month.

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270. During September, Booker Corporation budgeted for 20,000 customers, but actually served 22,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:


Required:

Prepare the company's flexible budget for September based on the actual level of activity for the month.

271. During July, Bosell Corporation budgeted for 22,000 customers, but actually served 21,000 customers. Revenue should be $6.80 per customer served. Wages and salaries should be $35,900 per month plus $2.40 per customer served. Supplies should be $1.20 per customer served. Insurance should be $12,000 per month. Miscellaneous expenses should be $6,000 per month plus $0.30 per customer served.

Required:

Prepare the company's flexible budget for July based on the actual level of activity for the month.

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272. Gramling Clinic bases its budgets on patient-visits. During July, the clinic plans for a level of activity of 2,500 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the clinic's planning budget for July.

273. During September, Noaks Clinic plans for an activity level of 3,300 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits: Revenue: $30.50qPersonnel expenses: $30,900 + $8.40qMedical supplies: $1,200 + $4.50qOccupancy expenses: $6,400 + $1.70qAdministrative expenses: $3,700 + $0.10q

Required:

Prepare the clinic's planning budget for September.

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274. During June, Defee Clinic plans for an activity level of 3,200 patient-visits. Revenue is $50.80 per patient-visit. Personnel expenses are $35,300 per month plus $16.70 per patient-visit. Medical supplies are $1,400 per month plus $8.50 per patient-visit. Occupancy expenses are $12,500 per month plus $2.60 per patient-visit. Administrative expenses are $7,200 per month plus $0.20 per patient-visit.

Required:

Prepare the clinic's planning budget for June.

275. Clune Clinic bases its budgets on the activity measure patient-visits. During October, the clinic planned for an activity level of 2,100 patient-visits, but the activity level was actually 2,600 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the clinic's flexible budget for October based on the actual level of activity for the month.

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276. During October, Moceri Clinic budgeted for 3,000 patient-visits, but its actual level of activity was 3,500 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:


Required:


277. During May, Phong Clinic budgeted for 2,900 patient-visits, but its actual level of activity was 3,100 patient-visits. Revenue should be $31.30 per patient-visit. Personnel expenses should be $23,700 per month plus $8.10 per patient-visit. Medical supplies should be $700 per month plus $6.20 per patient-visit. Occupancy expenses should be $7,000 per month plus $1.50 per patient-visit. Administrative expenses should be $3,400 per month plus $0.40 per patient-visit.

Required:

Prepare the clinic's flexible budget for May based on the actual level of activity for the month.

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278. Vilanova Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for May is to be based on 2,700 meals. The diner's director has provided the following cost formulas to use in the budget:

Required:

Prepare the diner's budget for the month of May. The budget will only contain the costs listed above; no revenues will be on the budget.

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279. Mcduffey Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for September was based on 2,900 meals, but the diner actually served 2,800 meals. The diner's director has provided the following cost formulas to use in budgets:

Required:

Prepare the diner's flexible budget for the actual number of meals served in September. The budget will only contain the costs listed above; no revenues will be on the budget.

280. Korando Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for June is to be based on 2,900 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.60 per meal; kitchen operations, $4,200 per month plus $1.15 per meal; administrative expenses, $2,800 per month plus $0.65 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare the diner's budget for the month of June. The budget will only contain the costs listed above; no revenues will be on the budget.

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281. Salvia Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for May was based on 3,400 meals, but the diner actually served 3,700 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.90 per meal; kitchen operations, $4,100 per month plus $1.90 per meal; administrative expenses, $2,400 per month plus $0.20 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare the diner's flexible budget for the actual number of meals served in May. The budget will only contain the costs listed above; no revenues will be on the budget.

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282. Alarie Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In November, the school budgeted for 1,420 students and 139 courses. The actual activity for the month was 1,220 students and 142 courses.

Required:

Prepare a report showing the school's activity variances for November. Label each variance as favorable (F) or unfavorable (U).

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283. Eisner Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In October, the school budgeted for 1,490 students and 85 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the school's activity variances for October. Label each variance as favorable (F) or unfavorable (U).

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284. Bures Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In April, the company budgeted for 360 guests and 134 jeeps. The actual activity for the month was 335 guests and 136 jeeps.

Required:

Prepare a report showing the company's activity variances for April. Label each variance as favorable (F) or unfavorable (U).

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285. Mashore Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In April, the company budgeted for 495 guests and 187 jeeps. The company's income statement showing the actual results for the month appears below:

Required:


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286. Ahrns Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In July, the school budgeted for 1,770 students and 148 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the school's revenue and spending variances for July. Label each variance as favorable (F) or unfavorable (U).

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287. Ruvolo Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In February, the company budgeted for 436 guests and 162 jeeps. The company's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the company's revenue and spending variances for February. Label each variance as favorable (F) or unfavorable (U).

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288. Brink Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In June, the school budgeted for 1,710 students and 110 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a flexible budget performance report showing both the school's activity variances and revenue and spending variances for June. Label each variance as favorable (F) or unfavorable (U).

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289. Palamino Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In January, the company budgeted for 330 guests and 143 jeeps. The company's income statement showing the actual results for the month appears below:

Required:

Prepare a flexible budget performance report showing both the company's activity variances and revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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290. Alto Clinic uses patient-visits as its measure of activity. The clinic has provided the following report:

Required:

Prepare the clinic's flexible budget performance report for June. Label each variance as favorable (F) or unfavorable (U).

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291. Drobot Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:


Required:

Prepare the school's planning budget for November.

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292. Hasselman Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In January, the school budgeted for 1,110 students and 105 courses. The actual activity for the month was 1,210 students and 103 courses.

Required:

Prepare the school's flexible budget for the actual level of activity in January.

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293. Lantrip Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In January, the company budgeted for 356 guests and 174 jeeps. The actual activity for the month was 341 guests and 177 jeeps.

Required:

Prepare the company's planning budget for January.

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294. Karpin Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In July, the company budgeted for 434 guests and 132 jeeps. The actual activity for the month was 459 guests and 137 jeeps.

Required:

Prepare the company's flexible budget for the actual level of activity in July.

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Chapter 010, Flexible Budgets and Performance Analysis Key

True / False Questions

1. The main difference between a flexible budget and a static budget is that a flexible budget does not contain fixed costs. FALSE

AACSB: Reflective ThinkingAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Level: Easy

2. A problem with directly comparing a static planning budget to actual costs is that this comparison fails to distinguish between differences in costs that are due to changes in activity and differences that are due to how well costs were controlled. TRUE


3. A planning budget is prepared before the period begins and is valid for only the planned level of activity. TRUE


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4. A flexible budget is an estimate of what revenues and costs should have been, given the level of activity that had been planned for the period. FALSE

AACSB: Reflective ThinkingAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Level: Medium

5. An unfavorable activity variance for a cost indicates that spending was higher than it should have been for the actual level of activity for the period. FALSE


6. The activity variance for revenue is unfavorable if the actual revenue for the period is less than the revenue in the static planning budget. FALSE


7. The revenue and spending variances are the differences between the static planning budget and the flexible budget. FALSE


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8. A revenue variance is unfavorable if the actual revenue is less than what the revenue should have been for the actual level of activity for the period. TRUE


9. When the activity measure is the number of units sold, the revenue variance is unfavorable if the average actual selling price is less than expected. TRUE


10. A favorable spending variance occurs when the actual cost is less than the amount of that cost in the flexible budget. TRUE


11. A flexible budget performance report should contain fixed as well as variable and mixed costs. TRUE


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12. It may be easier to control fixed costs than variable costs. TRUE


13. A static planning budget is suitable for planning and for evaluating how well costs are controlled. FALSE


14. If the actual level of activity is 4% less than planned, then the costs in the static budget should be reduced by 4% before comparing them to actual costs. FALSE


15. If the actual level of activity is 4% more than planned, then the fixed costs in the static budget should be increased by 4% before comparing them to actual costs. FALSE


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Multiple Choice Questions

16. A flexible budget: A. classifies budget requests by activity and estimates the benefits arising from each activity.B. presents a statement of expectations for a period of time but does not present a firm commitment.C. presents the plan for only one level of activity and does not adjust to changes in the level of activity.D. presents the plan for a range of activity so that the plan can be adjusted for changes in activity levels.

AACSB: Reflective ThinkingAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Level: EasySource: CMA, adapted

17. A flexible budget is a budget that: A. is updated with actual costs as they occur during the period.B. is updated to reflect the actual level of activity during the period.C. is prepared using a computer spreadsheet application.D. contains only variable production costs.

AACSB: Reflective ThinkingAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Level: EasySource: CIMA, adapted

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18. Which of the following comparisons best isolates the impact that changes in prices of inputs and outputs have on performance? A. static planning budget and flexible budgetB. static planning budget and actual resultsC. flexible budget and actual resultsD. master budget and static planning budget


19. Marchi Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below:

The Inn's variable overhead costs are driven by the number of guests. What would be the total budgeted overhead cost for a month if the activity level is 70 guests? A. $42,460.00B. $6,620.00C. $7,086.15D. $6,580.00

Variable cost per guest = ($156 + $364) 65 guests = $8 per guest($250 + $4,480 + $1,330) + ($8 x 70) = $6,620.00

AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Level: Easy

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20. Barringer Manufacturing Corporation has prepared the following overhead budget for next month.

The company's variable overhead costs are driven by machine-hours. What would be the total budgeted overhead cost for next month if the activity level is 7,900 machine-hours rather than 7,800 machine-hours? A. $110,710.00B. $109,620.00C. $110,868.00D. $111,025.38

Variable cost per machine-hour = ($34,320 + $50,700) 7,800 machine-hours= $10.90 per machine-hour($10,200 + $5,600 + $8,800) + ($10.90 x 7,900) = $110,710.00


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21. Placek Hospital bases its budgets on patient-visits. The hospital's static budget for October appears below:

The total overhead cost at an activity level of 7,700 patient-visits per month should be: A. $129,550B. $121,720C. $129,100D. $137,830

($21,080 + $44,880) + [($2.60 + $5.60) x 7,700] = $129,100


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22. Dike Hotel bases its budgets on guest-days. The hotel's static budget for June appears below:

The total overhead cost at an activity level of 8,400 guest-days per month should be: A. $159,440B. $149,650C. $160,430D. $172,200

($68,620 + $16,060) + [($6.70 + $2.20) x 8,400] = $159,440


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23. Blackwelder Snow Removal's cost formula for its vehicle operating cost is $1,240 per month plus $348 per snow-day. For the month of December, the company planned for activity of 12 snow-days, but the actual level of activity was 14 snow-days. The actual vehicle operating cost for the month was $6,330. The vehicle operating cost in the planning budget for December would be closest to: A. $5,426B. $6,112C. $5,416D. $6,330

$1,240 + $348 x 12 = $5,416


24. Ofarrell Snow Removal's cost formula for its vehicle operating cost is $1,840 per month plus $377 per snow-day. For the month of November, the company planned for activity of 14 snow-days, but the actual level of activity was 19 snow-days. The actual vehicle operating cost for the month was $9,280. The vehicle operating cost in the flexible budget for November would be closest to: A. $9,003B. $7,118C. $9,280D. $9,660

$1,840 + $377 x 19 = $9,003


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25. Guilbault Midwifery's cost formula for its wages and salaries is $2,340 per month plus $154 per birth. For the month of June, the company planned for activity of 115 births, but the actual level of activity was 112 births. The actual wages and salaries for the month was $19,530. The wages and salaries in the planning budget for June would be closest to: A. $19,530B. $19,588C. $20,053D. $20,050

$2,340 + $154 x 115 = $20,050


26. Dewberry Midwifery's cost formula for its wages and salaries is $1,960 per month plus $429 per birth. For the month of December, the company planned for activity of 128 births, but the actual level of activity was 130 births. The actual wages and salaries for the month was $56,020. The wages and salaries in the flexible budget for December would be closest to: A. $57,761B. $57,730C. $56,020D. $56,872

$1,960 + $429 x 130 = $57,730


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27. Entler Framing's cost formula for its supplies cost is $2,250 per month plus $16 per frame. For the month of June, the company planned for activity of 502 frames, but the actual level of activity was 497 frames. The actual supplies cost for the month was $10,580. The supplies cost in the planning budget for June would be closest to: A. $10,580B. $10,282C. $10,686D. $10,202

$2,250 + $16 x 502 = $10,282


28. Rising Framing's cost formula for its supplies cost is $2,210 per month plus $10 per frame. For the month of January, the company planned for activity of 710 frames, but the actual level of activity was 705 frames. The actual supplies cost for the month was $9,500. The supplies cost in the flexible budget for January would be closest to: A. $9,260B. $9,244C. $9,500D. $9,310

$2,210 + $10 x 705 = $9,260


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29. Naval Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $430 per month plus $99 per job plus $10 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in March to be 12 jobs and 126 meals, but the actual activity was 9 jobs and 124 meals. The actual cost for catering supplies in March was $2,550. The catering supplies in the planning budget for March would be closest to: A. $3,400B. $2,561C. $2,550D. $2,878

$430 + $99 x 12 + $10 x 126 = $2,878


30. Johannsen Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $310 per month plus $103 per job plus $23 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in February to be 28 jobs and 187 meals, but the actual activity was 26 jobs and 192 meals. The actual cost for catering supplies in February was $7,620. The catering supplies in the flexible budget for February would be closest to: A. $7,495B. $7,404C. $7,620D. $6,960

$310 + $103 x 26 + $23 x 192 = $7,404


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31. Venanzi Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $40,720 per month plus $2,646 per flight plus $11 per passenger. The company expected its activity in September to be 62 flights and 288 passengers, but the actual activity was 64 flights and 289 passengers. The actual cost for plane operating costs in September was $214,430. The activity variance for plane operating costs in September would be closest to: A. $6,490 UB. $5,303 FC. $6,490 FD. $5,303 U

Since the flexible budget is greater than the planning budget, the variance is unfavorable (U)

AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 2Learning Objective: 5Level: Easy

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32. Kimbril Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $530 per month plus $91 per job plus $12 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in January to be 27 jobs and 174 meals, but the actual activity was 31 jobs and 173 meals. The actual cost for catering supplies in January was $5,330. The activity variance for catering supplies in January would be closest to: A. $255 FB. $255 UC. $352 FD. $352 U



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33. Portsche Snow Removal's cost formula for its vehicle operating cost is $2,310 per month plus $317 per snow-day. For the month of November, the company planned for activity of 18 snow-days, but the actual level of activity was 20 snow-days. The actual vehicle operating cost for the month was $8,730. The activity variance for vehicle operating cost in November would be closest to: A. $714 UB. $714 FC. $634 FD. $634 U



34. Reuer Midwifery's cost formula for its wages and salaries is $2,900 per month plus $475 per birth. For the month of March, the company planned for activity of 116 births, but the actual level of activity was 117 births. The actual wages and salaries for the month was $56,270. The activity variance for wages and salaries in March would be closest to: A. $1,730 UB. $475 FC. $475 UD. $1,730 F



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35. Embertson Framing's cost formula for its supplies cost is $1,350 per month plus $16 per frame. For the month of June, the company planned for activity of 816 frames, but the actual level of activity was 812 frames. The actual supplies cost for the month was $14,680. The activity variance for supplies cost in June would be closest to: A. $64 UB. $274 UC. $64 FD. $274 F

Since the flexible budget expense is less than the planning budget, the variance is favorable (F)


36. Lapinsky Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $31,400 per month plus $2,148 per flight plus $7 per passenger. The company expected its activity in April to be 89 flights and 261 passengers, but the actual activity was 84 flights and 260 passengers. The actual cost for plane operating costs in April was $204,810. The spending variance for plane operating costs in April would be closest to: A. $8,842 UB. $19,589 FC. $19,589 UD. $8,842 F

Since the actual expense is less than the flexible budget, the variance is favorable (F)


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37. Posson Catering uses two measures of activity, jobs and meals, in the cost formulas in its budgets and performance reports. The cost formula for catering supplies is $210 per month plus $96 per job plus $20 per meal. A typical job involves serving a number of meals to guests at a corporate function or at a host's home. The company expected its activity in March to be 20 jobs and 162 meals, but the actual activity was 17 jobs and 164 meals. The actual cost for catering supplies in March was $4,990. The spending variance for catering supplies in March would be closest to: A. $380 FB. $132 UC. $132 FD. $380 U



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38. Dunklin Medical Clinic measures its activity in terms of patient-visits. Last month, the budgeted level of activity was 1,620 patient-visits and the actual level of activity was 1,540 patient-visits. The cost formula for administrative expenses is $3.20 per patient-visit plus $14,300 per month. The actual administrative expense was $21,050. In the clinic's flexible budget performance report for last month, the spending variance for administrative expenses was: A. $118 FB. $256 FC. $1,566 UD. $1,822 U

Since the actual expense is more than the flexible budget, the variance is unfavorable (U)

AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 3Level: Medium

39. Brattain Tile Installation Corporation measures its activity in terms of square feet of tile installed. Last month, the budgeted level of activity was 1,230 square feet and the actual level of activity was 1,140 square feet. The company's owner budgets for supply costs, a variable cost, at $2.10 per square foot. The actual supply cost last month was $3,260. In the company's flexible budget performance report for last month, what would have been the spending variance for supply costs? A. $257 FB. $866 UC. $677 UD. $189 F



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40. Cahalane Natural Dying Corporation measures its activity in terms of skeins of yarn dyed. Last month, the budgeted level of activity was 11,600 skeins and the actual level of activity was 12,000 skeins. The company's owner budgets for dye costs, a variable cost, at $0.31 per skein. The actual dye cost last month was $3,540. In the company's flexible budget performance report for last month, what would have been the spending variance for dye costs? A. $118 UB. $124 UC. $56 FD. $180 F



41. Gladstone Footwear Corporation's flexible budget cost formula for supplies, a variable cost, is $2.83 per unit of output. The company's flexible budget performance report for last month showed a $9,555 unfavorable spending variance for supplies. During that month, 19,500 units were produced. Budgeted activity for the month had been 19,300 units. The actual cost per unit for indirect materials must have been closest to: A. $3.32B. $3.81C. $2.83D. $3.85

Actual supplies - Flexible budget = Spending variable (U)Actual supplies - (19,500 x $2.83) = $9,555Actual supplies = $64,740Actual cost per unit = $64,740 19,500 = $3.32

AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 3Level: Hard

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42. Velten Corporation's flexible budget performance report for last month shows that actual indirect materials cost, a variable cost, was $45,198 and that the spending variance for indirect materials cost was $9,114 favorable. During that month, the company worked 18,600 machine-hours. Budgeted activity for the month had been 19,000 machine-hours. The cost formula per machine-hour for indirect materials cost must have been closest to: A. $1.90B. $2.86C. $1.94D. $2.92

Flexible budget - Actual cost = Spending variance (F)Flexible budget - $45,198 = $9,114Flexible budget = $54,312Cost formula per machine hour = $54,312 18,600 = $2.92

AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 3Level: Hard

43. Lesinski Snow Removal's cost formula for its vehicle operating cost is $1,770 per month plus $483 per snow-day. For the month of February, the company planned for activity of 19 snow-days, but the actual level of activity was 24 snow-days. The actual vehicle operating cost for the month was $13,070. The spending variance for vehicle operating cost in February would be closest to: A. $2,123 UB. $292 FC. $2,123 FD. $292 U



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44. Harville Midwifery's cost formula for its wages and salaries is $1,610 per month plus $199 per birth. For the month of March, the company planned for activity of 118 births, but the actual level of activity was 122 births. The actual wages and salaries for the month was $25,430. The spending variance for wages and salaries in March would be closest to: A. $458 FB. $338 UC. $458 UD. $338 F



45. Olivier Framing's cost formula for its supplies cost is $2,870 per month plus $16 per frame. For the month of January, the company planned for activity of 533 frames, but the actual level of activity was 534 frames. The actual supplies cost for the month was $11,080. The spending variance for supplies cost in January would be closest to: A. $334 UB. $334 FC. $318 UD. $318 F



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46. Elizarraras Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $39,820 per month plus $2,938 per flight plus $8 per passenger. The company expected its activity in June to be 64 flights and 229 passengers, but the actual activity was 66 flights and 225 passengers. The actual cost for plane operating costs in June was $234,570. The plane operating costs in the planning budget for June would be closest to: A. $229,684B. $227,462C. $234,570D. $235,528

$39,820 + $2,938 x 64 + $8 x 229 = $229,684


47. Niforos Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $41,380 per month plus $2,282 per flight plus $14 per passenger. The company expected its activity in August to be 77 flights and 264 passengers, but the actual activity was 78 flights and 261 passengers. The actual cost for plane operating costs in August was $216,740. The plane operating costs in the flexible budget for August would be closest to: A. $220,790B. $223,030C. $223,657D. $216,740

$41,380 + $2,282 x 78 + $14 x 261 = $223,030


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Pollica Corporation's cost formula for its selling and administrative expense is $11,400 per month plus $94 per unit. For the month of March, the company planned for activity of 5,700 units, but the actual level of activity was 5,660 units. The actual selling and administrative expense for the month was $522,860.

48. The selling and administrative expense in the planning budget for March would be closest to: A. $522,860B. $547,200C. $543,440D. $526,555

$11,400 + $94 x 5,700 = $547,200


49. The selling and administrative expense in the flexible budget for March would be closest to: A. $547,200B. $522,860C. $543,360D. $543,440

$11,400 + $94 x 5,660 = $543,440


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50. The activity variance for selling and administrative expense in March would be closest to: A. $24,340 FB. $24,340 UC. $3,760 UD. $3,760 F



51. The spending variance for selling and administrative expense in March would be closest to: A. $20,580 FB. $24,340 UC. $24,340 FD. $20,580 U



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Kuczenski Corporation's cost formula for its manufacturing overhead is $45,700 per month plus $53 per machine-hour. For the month of March, the company planned for activity of 6,200 machine-hours, but the actual level of activity was 6,150 machine-hours. The actual manufacturing overhead for the month was $373,630.

52. The manufacturing overhead in the planning budget for March would be closest to: A. $373,630B. $371,650C. $376,668D. $374,300

$45,700 + $53 x 6,200 = $374,300



$45,700 + $53 x 6,150 = $371,650


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54. The activity variance for manufacturing overhead in March would be closest to: A. $670 UB. $670 FC. $2,650 FD. $2,650 U



55. The spending variance for manufacturing overhead in March would be closest to: A. $670 FB. $1,980 UC. $1,980 FD. $670 U

Since the actual expense is greater than the flexible budget, the variance is unfavorable (U)


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Kaaihue Detailing's cost formula for its materials and supplies is $2,750 per month plus $17 per vehicle. For the month of April, the company planned for activity of 95 vehicles, but the actual level of activity was 135 vehicles. The actual materials and supplies for the month was $4,850.

56. The materials and supplies in the planning budget for April would be closest to: A. $4,850B. $5,045C. $3,413D. $4,365

$2,750 + $17 x 95 = $4,365


57. The materials and supplies in the flexible budget for April would be closest to: A. $6,203B. $4,850C. $4,365D. $5,045

$2,750 + $17 x 135 = $5,045


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58. The activity variance for materials and supplies in April would be closest to: A. $680 UB. $485 FC. $680 FD. $485 U



59. The spending variance for materials and supplies in April would be closest to: A. $195 FB. $485 FC. $195 UD. $485 U



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Deleston Boat Wash's cost formula for its cleaning equipment and supplies is $2,150 per month plus $21 per boat. For the month of September, the company planned for activity of 79 boats, but the actual level of activity was 39 boats. The actual cleaning equipment and supplies for the month was $3,110.

60. The cleaning equipment and supplies in the planning budget for September would be closest to: A. $3,110B. $6,300C. $2,969D. $3,809

$2,150 + $21 x 79 = $3,809


61. The cleaning equipment and supplies in the flexible budget for September would be closest to: A. $1,880B. $3,110C. $3,809D. $2,969

$2,150 + $21 x 39 = $2,969


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62. The activity variance for cleaning equipment and supplies in September would be closest to: A. $840 FB. $699 FC. $699 UD. $840 U



63. The spending variance for cleaning equipment and supplies in September would be closest to: A. $699 FB. $699 UC. $141 FD. $141 U



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Werber Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 2,700 client-visits, but its actual level of activity was 2,730 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

64. The activity variance for personnel expenses in January would be closest to: A. $661 UB. $261 UC. $261 FD. $661 F


AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Learning Objective: 2Level: Medium

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65. The activity variance for administrative expenses in January would be closest to: A. $12 FB. $8 FC. $12 UD. $8 U



66. The activity variance for net operating income in January would be closest to: A. $2,019 UB. $2,019 FC. $489 FD. $489 U

Since the flexible budget net operating income is greater than the planning budget, the variance is favorable (F)


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Feiner Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,220 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:

67. The activity variance for personnel expenses in December would be closest to: A. $4,024 FB. $466 FC. $466 UD. $4,024 U



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68. The activity variance for administrative expenses in December would be closest to: A. $8 FB. $162 FC. $162 UD. $8 U



69. The activity variance for net operating income in December would be closest to: A. $690 UB. $9,670 UC. $690 FD. $9,670 F



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Grundhoefer Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During April, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 1,990 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for April:

70. The activity variance for wages and salaries in April would be closest to: A. $66 FB. $564 UC. $564 FD. $66 U



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71. The activity variance for administrative expenses in April would be closest to: A. $1 FB. $79 FC. $79 UD. $1 U



72. The activity variance for net operating income in April would be closest to: A. $141 UB. $2,651 UC. $2,651 FD. $141 F

Since the flexible budget net operating income is less than the planning budget, the variance is unfavorable (U)


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Gorley Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 3,900 tenant-days, but its actual level of activity was 3,940 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

73. The activity variance for wages and salaries in February would be closest to: A. $1,152 UB. $1,152 FC. $292 UD. $292 F



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75. The activity variance for net operating income in February would be closest to: A. $368 FB. $368 UC. $632 FD. $632 U



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Enriques Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 5,000 units, but its actual level of activity was 4,990 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for February:

76. The activity variance for direct labor in February would be closest to: A. $61 UB. $1,081 UC. $61 FD. $1,081 F



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77. The activity variance for selling and administrative expenses in February would be closest to: A. $1,308 FB. $1,308 UC. $2 UD. $2 F



78. The activity variance for net operating income in February would be closest to: A. $2,716 FB. $2,716 UC. $176 UD. $176 F



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Palczewski Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During December, the company budgeted for 5,000 units, but its actual level of activity was 4,980 units. The company has provided the following data concerning the formulas to be used in its budgeting:

79. The activity variance for direct labor in December would be closest to: A. $180 UB. $70 FC. $70 UD. $180 F



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80. The activity variance for selling and administrative expenses in December would be closest to: A. $14 UB. $14 FC. $1,206 FD. $1,206 U



81. The activity variance for net operating income in December would be closest to: A. $2,372 UB. $328 FC. $2,372 FD. $328 U



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Burget Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,110 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:

82. The revenue variance for July would be closest to: A. $2,581 FB. $2,110 UC. $2,110 FD. $2,581 U

Since the actual revenue is greater than the flexible budget, the variance is favorable (F)


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83. The spending variance for medical supplies in July would be closest to: A. $580 UB. $645 UC. $645 FD. $580 F



84. The spending variance for occupancy expenses in July would be closest to: A. $265 FB. $280 UC. $280 FD. $265 U



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85. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for July would be closest to: A. $4,508 FB. $4,290 UC. $4,290 FD. $4,508 U

Since the actual net operating income is greater than the flexible budget, the variance is favorable (F)


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Razor Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During November, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 3,010 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for November:

86. The revenue variance for November would be closest to: A. $1,607 UB. $1,910 UC. $1,607 FD. $1,910 F

Since the actual revenue is less than the flexible budget, the variance is unfavorable (U)


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87. The spending variance for expendables in November would be closest to: A. $240 FB. $354 FC. $240 UD. $354 U



88. The spending variance for facility expenses in November would be closest to: A. $416 UB. $416 FC. $390 FD. $390 U



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89. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for November would be closest to: A. $3,520 FB. $3,428 UC. $3,520 UD. $3,428 F

Since the actual net operating income is less than the flexible budget, the variance is unfavorable (U)


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Vandall Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,300 units, but its actual level of activity was 7,340 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April:

90. The revenue variance for April would be closest to: A. $4,274 FB. $5,690 FC. $5,690 UD. $4,274 U



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91. The spending variance for direct materials in April would be closest to: A. $210 UB. $210 FC. $426 UD. $426 F



92. The spending variance for manufacturing overhead in April would be closest to: A. $1,600 UB. $1,648 FC. $1,600 FD. $1,648 U



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93. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for April would be closest to: A. $6,144 FB. $6,740 UC. $6,740 FD. $6,144 U



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Moorhouse Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,690 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December:

94. The personnel expenses in the planning budget for December would be closest to: A. $51,009B. $51,147C. $53,370D. $53,299

$27,100 + $7.10 x 3,700 = $53,370


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95. The medical supplies in the flexible budget for December would be closest to: A. $18,150B. $17,472C. $17,378D. $18,105

$1,500 + $4.50 x 3,690 = $18,105


96. The activity variance for personnel expenses in December would be closest to: A. $2,361 UB. $71 UC. $71 FD. $2,361 F



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97. The revenue variance for December would be closest to: A. $3,680 UB. $3,429 FC. $3,429 UD. $3,680 F

Since the actual revenue is greater than the flexible budget, the variance is favorable (F)


98. The spending variance for medical supplies in December would be closest to: A. $680 FB. $680 UC. $725 UD. $725 F



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Cotty Clinic uses client-visits as its measure of activity. During March, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,970 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for March:

99. The administrative expenses in the planning budget for March would be closest to: A. $6,288B. $6,300C. $6,418D. $6,483

$5,100 + $0.40 x 3,000 = $6,300


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100. The occupancy expenses in the flexible budget for March would be closest to: A. $13,400B. $12,770C. $13,349D. $13,029

$8,300 + $1.70 x 2,970 = $13,349


101. The activity variance for administrative expenses in March would be closest to: A. $118 UB. $12 FC. $118 FD. $12 U



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102. The spending variance for medical supplies in March would be closest to: A. $1,050 UB. $1,050 FC. $1,263 FD. $1,263 U



Murphree Clinic uses client-visits as its measure of activity. During April, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,350 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for April:

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103. The net operating income in the planning budget for April would be closest to: A. $14,425B. $19,519C. $13,550D. $20,115




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105. The activity variance for net operating income in April would be closest to: A. $875 FB. $6,265 FC. $875 UD. $6,265 U



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106. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for April would be closest to: A. $5,390 FB. $6,265 UC. $5,390 UD. $6,265 F



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Henkel Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 3,600 client-visits, but its actual level of activity was 3,550 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for November:

107. The personnel expenses in the planning budget for November would be closest to: A. $74,120B. $71,432C. $70,440D. $74,640

$37,200 + $10.40 x 3,600 = $74,640


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108. The occupancy expenses in the flexible budget for November would be closest to: A. $14,422B. $14,831C. $15,325D. $15,400

$10,000 + $1.50 x 3,550 = $15,325


109. The activity variance for administrative expenses in November would be closest to: A. $215 UB. $215 FC. $5 FD. $5 U



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110. The spending variance for occupancy expenses in November would be closest to: A. $775 UB. $700 FC. $775 FD. $700 U



Hoeper Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 2,600 client-visits, but its actual level of activity was 2,570 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

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111. The administrative expenses in the planning budget for January would be closest to: A. $5,047B. $4,960C. $5,106D. $4,957

$4,700 + $0.10 x 2,600 = $4,960


112. The medical supplies in the flexible budget for January would be closest to: A. $19,733B. $18,932C. $19,940D. $19,377

$2,000 + $6.90 x 2,570 = $19,733


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113. The activity variance for personnel expenses in January would be closest to: A. $1,416 UB. $486 FC. $1,416 FD. $486 U



114. The spending variance for medical supplies in January would be closest to: A. $787 FB. $787 UC. $580 FD. $580 U



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Legard Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During January, the kennel budgeted for 2,600 tenant-days, but its actual level of activity was 2,620 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for January:

115. The wages and salaries in the planning budget for January would be closest to: A. $24,040B. $23,755C. $23,938D. $24,198

$3,500 + $7.90 x 2,600 = $24,040


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116. The expendables in the flexible budget for January would be closest to: A. $35,946B. $36,704C. $35,680D. $37,271

$1,100 + $13.30 x 2,620 = $35,946


117. The activity variance for wages and salaries in January would be closest to: A. $158 FB. $158 UC. $102 UD. $102 F



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118. The revenue variance for January would be closest to: A. $750 UB. $40 UC. $40 FD. $750 F



119. The spending variance for expendables in January would be closest to: A. $1,040 FB. $1,306 FC. $1,040 UD. $1,306 U



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Drabant Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,040 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:


$6,900 + $0.30 x 2,000 = $7,500


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$9,300 + $2.20 x 2,040 = $13,788


122. The activity variance for administrative expenses in February would be closest to: A. $248 UB. $248 FC. $12 UD. $12 F



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123. The spending variance for expendables in February would be closest to: A. $836 FB. $1,360 FC. $836 UD. $1,360 U



Tosta Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 2,100 tenant-days, but its actual level of activity was 2,050 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:

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126. The activity variance for net operating income in May would be closest to: A. $2,770 UB. $720 UC. $720 FD. $2,770 F



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127. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for May would be closest to: A. $3,490 FB. $2,770 FC. $3,490 UD. $2,770 U



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Stent Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,950 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:


$3,200 + $6.60 x 3,000 = $23,000


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$8,500 + $2.50 x 2,950 = $15,875





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131. The spending variance for facility expenses in February would be closest to: A. $130 UB. $130 FC. $5 UD. $5 F



Rippelmeyer Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During June, the kennel budgeted for 3,600 tenant-days, but its actual level of activity was 3,550 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for June:

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132. The administrative expenses in the planning budget for June would be closest to: A. $7,996B. $7,885C. $7,555D. $7,560

$7,200 + $0.10 x 3,600 = $7,560


133. The expendables in the flexible budget for June would be closest to: A. $33,666B. $34,270C. $34,740D. $34,621

$900 + $9.40 x 3,550 = $34,270


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134. The activity variance for wages and salaries in June would be closest to: A. $310 FB. $110 FC. $310 UD. $110 U



135. The spending variance for expendables in June would be closest to: A. $130 FB. $600 UC. $130 UD. $600 F



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Baugus Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 6,900 units, but its actual level of activity was 6,950 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:


$0 + $4.20 x 6,900 = $28,980


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$0 + $18.50 x 6,950 = $128,575


138. The activity variance for direct labor in August would be closest to: A. $1,220 FB. $210 UC. $210 FD. $1,220 U



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139. The revenue variance for August would be closest to: A. $1,450 FB. $1,450 UC. $430 FD. $430 U



140. The spending variance for direct materials in August would be closest to: A. $70 FB. $855 UC. $70 UD. $855 F



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Lampert Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 6,100 units, but its actual level of activity was 6,060 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for March:


$22,900 + $0.60 x 6,100 = $26,560


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$42,900 + $1.40 x 6,060 = $51,384


143. The activity variance for selling and administrative expenses in March would be closest to: A. $906 UB. $906 FC. $24 UD. $24 F



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144. The spending variance for direct materials in March would be closest to: A. $900 FB. $900 UC. $1,376 UD. $1,376 F



Woofter Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,600 units, but its actual level of activity was 7,560 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January:

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145. The net operating income in the planning budget for January would be closest to: A. $16,410B. $16,238C. $28,604D. $29,140


146. The net operating income in the flexible budget for January would be closest to: A. $28,604B. $16,238C. $16,410D. $29,140


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147. The activity variance for net operating income in January would be closest to: A. $12,816 FB. $12,816 UC. $536 FD. $536 U



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148. The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for January would be closest to: A. $12,816 FB. $12,280 UC. $12,816 UD. $12,280 F



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Buffaloe Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 5,200 units, but its actual level of activity was 5,250 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:


$0 + $7.70 x 5,200 = $40,040


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$48,700 + $1.30 x 5,250 = $55,525


151. The activity variance for selling and administrative expenses in August would be closest to: A. $690 FB. $690 UC. $20 FD. $20 U



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152. The spending variance for manufacturing overhead in August would be closest to: A. $2,055 FB. $2,055 UC. $2,120 UD. $2,120 F



Luc Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 5,000 units, but its actual level of activity was 4,950 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for February:

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153. The selling and administrative expenses in the planning budget for February would be closest to: A. $30,490B. $30,495C. $30,500D. $30,190

$29,500 + $0.20 x 5,000 = $30,500


154. The direct materials in the flexible budget for February would be closest to: A. $91,575B. $95,985C. $92,500D. $94,075

$0 + $18.50 x 4,950 = $91,575


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155. The activity variance for direct labor in February would be closest to: A. $340 UB. $760 FC. $340 FD. $760 U



156. The spending variance for direct materials in February would be closest to: A. $3,450 FB. $2,525 UC. $3,450 UD. $2,525 F



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Worden Hospital bases its budgets on patient-visits. The hospital's static budget for February appears below:

157. The total variable cost at the activity level of 4,400 patient-visits per month should be: A. $85,140B. $87,120C. $65,120D. $63,640

Total variable cost = ($6.10 + $8.70) x 4,400 = $65,120


158. The total fixed cost at the activity level of 4,700 patient-visits per month should be: A. $162,620B. $148,780C. $93,060D. $85,140

Total fixed cost = $33,110 + $52,030 = $85,140


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159. The total cost at the activity level of 4,600 patient-visits per month should be: A. $153,720B. $148,780C. $153,220D. $159,160

Total fixed cost = $33,110 + $52,030 = $85,140Total cost = [($6.10 + $8.70) x 4,600] + $85,140 = $153,220


Dwelmont Hotel bases its budgets on guest-days. The hotel's static budget for May appears below:

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160. The total variable cost at the activity level of 2,600 guest-days per month should be: A. $36,920B. $32,660C. $45,540D. $51,480

Total variable cost = ($8.30 + $5.90) x 2,600 = $36,920


161. The total fixed cost at the activity level of 2,900 guest-days per month should be: A. $78,200B. $57,420C. $98,600D. $45,540

Total fixed cost = $27,830 + $17,710 = $45,540


162. The total cost at the activity level of 2,800 guest-days per month should be: A. $95,200B. $86,230C. $85,300D. $78,200

Total fixed cost = $27,830 + $17,710 = $45,540Total cost = [($8.30 + $5.90) x 2,800] + $45,540 = $85,300


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Springmeyer Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 2,900 client-visits, but its actual level of activity was 2,940 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:


$29,700 + $15 x 2,900 = $73,200


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$7,300 + $0.10 x 2,900 = $7,590




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Weisgarber Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for August:


$34,800 + $12.60 x 3,900 = $83,940



$7,000 + $0.20 x 3,900 = $7,780


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Smithson Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,270 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for May:

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$1,500 + $4.10 x 3,270 = $14,907


170. The occupancy expenses in the flexible budget for May would be closest to: A. $14,334B. $13,840C. $13,786D. $14,599

$7,900 + $1.80 x 3,270 = $13,786


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Mah Clinic uses client-visits as its measure of activity. During April, the clinic budgeted for 3,800 client-visits, but its actual level of activity was 3,750 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:

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172. The medical supplies in the flexible budget for April would be closest to: A. $21,340B. $22,600C. $22,325D. $21,913

$1,700 + $5.50 x 3,750 = $22,325


173. The occupancy expenses in the flexible budget for April would be closest to: A. $15,575B. $15,660C. $14,975D. $15,377

$9,200 + $1.70 x 3,750 = $15,575


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Lauser Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,690 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:

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175. The personnel expenses in the planning budget for July would be closest to: A. $54,730B. $54,641C. $52,341D. $52,483

$21,800 + $8.90 x 3,700 = $54,730


176. The occupancy expenses in the flexible budget for July would be closest to: A. $12,466B. $12,991C. $12,921D. $12,480

$7,300 + $1.40 x 3,690 = $12,466


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Higgenbotham Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,600 client-visits, but its actual level of activity was 3,580 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for May:

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178. The administrative expenses in the planning budget for May would be closest to: A. $5,261B. $5,440C. $5,232D. $5,432

$4,000 + $0.40 x 3,600 = $5,440




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$1,700 + $4.90 x 3,580 = $19,242


Jauron Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During September, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,310 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for September:

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181. The wages and salaries in the planning budget for September would be closest to: A. $13,741B. $13,682C. $13,781D. $13,730

$2,000 + $5.10 x 2,300 = $13,730


182. The administrative expenses in the planning budget for September would be closest to: A. $7,362B. $7,181C. $7,360D. $7,212

$6,900 + $0.20 x 2,300 = $7,360


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183. The net operating income in the planning budget for September would be closest to: A. $10,772B. $6,979C. $10,866D. $6,870


Lutts Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During November, the kennel budgeted for 3,800 tenant-days, but its actual level of activity was 3,850 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

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184. The wages and salaries in the planning budget for November would be closest to: A. $27,610B. $27,280C. $28,238D. $28,610

$2,200 + $6.60 x 3,800 = $27,280


185. The administrative expenses in the planning budget for November would be closest to: A. $7,310B. $7,520C. $7,540D. $7,215

$6,000 + $0.40 x 3,800 = $7,520


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Swader Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 2,900 tenant-days, but its actual level of activity was 2,930 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March:

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187. The expendables in the flexible budget for March would be closest to: A. $25,905B. $25,650C. $27,274D. $26,719

$1,000 + $8.50 x 2,930 = $25,905


188. The facility expenses in the flexible budget for March would be closest to: A. $20,700B. $20,369C. $20,793D. $20,820

$9,100 + $4 x 2,930 = $20,820


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189. The net operating income in the flexible budget for March would be closest to: A. $12,522B. $12,267C. $9,414D. $9,120


Whetstine Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During September, the kennel budgeted for 3,200 tenant-days, but its actual level of activity was 3,180 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

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190. The expendables in the flexible budget for September would be closest to: A. $27,630B. $27,864C. $27,517D. $27,800

$600 + $8.50 x 3,180 = $27,630


191. The facility expenses in the flexible budget for September would be closest to: A. $21,320B. $21,238C. $21,513D. $21,784

$8,200 + $4.10 x 3,180 = $21,238


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192. The net operating income in the flexible budget for September would be closest to: A. $8,548B. $4,967C. $5,029D. $8,720


Kalinowski Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,320 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

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$2,000 + $5.90 x 2,300 = $15,570



$8,100 + $4.60 x 2,320 = $18,772


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195. The net operating income in the flexible budget for February would be closest to: A. $10,370B. $10,608C. $7,642D. $7,775


Laboe Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During February, the kennel budgeted for 2,900 tenant-days, but its actual level of activity was 2,940 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:

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$6,900 + $0.30 x 2,900 = $7,770


197. The net operating income in the planning budget for February would be closest to: A. $7,191B. $7,391C. $7,900D. $8,260


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198. The expendables in the flexible budget for February would be closest to: A. $26,990B. $27,354C. $27,021D. $27,772

$600 + $9.10 x 2,940 = $27,354


Dantuono Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During November, the company budgeted for 7,700 units, but its actual level of activity was 7,720 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for November:

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199. The direct labor in the planning budget for November would be closest to: A. $44,004B. $42,744C. $42,633D. $43,890

$0 + $5.70 x 7,700 = $43,890


200. The selling and administrative expenses in the planning budget for November would be closest to: A. $30,490B. $29,974C. $30,504D. $29,896

$25,100 + $0.70 x 7,700 = $30,490


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Menson Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During December, the company budgeted for 5,800 units, but its actual level of activity was 5,830 units. The company has provided the following data concerning the formulas to be used in its budgeting:

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202. The direct labor in the planning budget for December would be closest to: A. $46,057B. $45,820C. $43,927D. $43,701

$0 + $7.90 x 5,800 = $45,820


203. The selling and administrative expenses in the planning budget for December would be closest to: A. $24,898B. $24,880C. $23,988D. $23,865

$21,400 + $0.60 x 5,800 = $24,880


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204. The net operating income in the planning budget for December would be closest to: A. $19,788B. $24,979C. $19,380D. $25,238


Nasson Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 6,700 units, but its actual level of activity was 6,730 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for August:

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$0 + $10.60 x 6,730 = $71,338



$47,000 + $1.20 x 6,730 = $55,076


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207. The net operating income in the flexible budget for August would be closest to: A. $22,506B. $18,317C. $17,930D. $22,708


Poulsen Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,300 units, but its actual level of activity was 7,270 units. The company has provided the following data concerning the formulas to be used in its budgeting:

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208. The direct materials in the flexible budget for July would be closest to: A. $68,338B. $70,298C. $68,620D. $70,879

$0 + $9.40 x 7,270 = $68,338


209. The manufacturing overhead in the flexible budget for July would be closest to: A. $47,190B. $47,151C. $45,344D. $45,719

$37,700 + $1.30 x 7,270 = $47,151


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Witherington Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 7,800 units, but its actual level of activity was 7,850 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June:

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211. The direct labor in the planning budget for June would be closest to: A. $32,970B. $32,760C. $34,310D. $34,091

$0 + $4.20 x 7,800 = $32,760


212. The manufacturing overhead in the flexible budget for June would be closest to: A. $57,435B. $54,794C. $57,380D. $55,498

$48,800 + $1.10 x 7,850 = $57,435


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213. The net operating income in the flexible budget for June would be closest to: A. $34,017B. $33,585C. $29,520D. $30,190


Manago Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During March, the company budgeted for 5,300 units, but its actual level of activity was 5,310 units. The company has provided the following data concerning the formulas to be used in its budgeting:|

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$21,400 + $0.80 x 5,300 = $25,640


215. The net operating income in the planning budget for March would be closest to: A. $11,705B. $21,877C. $21,710D. $11,749


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216. The direct materials in the flexible budget for March would be closest to: A. $73,278B. $73,929C. $73,140D. $74,208

$0 + $13.80 x 5,310 = $73,278


Bessey Hospital bases its budgets on patient-visits. The hospital's static planning budget for January appears below:

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217. The spending variance for supplies costs in the flexible budget performance report for the month is: A. $4,180 FB. $4,180 UC. $2,560 FD. $2,560 U



218. The spending variance for laundry costs in the flexible budget performance report for the month is: A. $730 FB. $2,470 FC. $730 UD. $2,470 U



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219. The spending variance for occupancy costs in the flexible budget performance report for the month is: A. $330 FB. $2,090 FC. $330 UD. $2,090 U



Salling Corporation bases its budgets on machine-hours. The company's static planning budget for May appears below:

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220. The spending variance for supplies costs in the flexible budget performance report for the month should be: A. $1,340 UB. $1,340 FC. $460 UD. $460 F



221. The spending variance for power costs in the flexible budget performance report for the month should be: A. $310 UB. $310 FC. $820 UD. $820 F



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222. The spending variance for equipment depreciation in the flexible budget performance report for the month should be: A. $540 FB. $10 FC. $10 UD. $540 U



Genito Corporation's static planning budget for October appears below. The company bases its budgets on machine-hours.

In October, the actual number of machine-hours was 8,800, the actual supplies cost was $69,450, the actual power cost was $34,190, the actual salaries cost was $86,490, and the actual equipment depreciation was $37,600.

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223. The spending variance for supplies cost in the flexible budget performance report for the month should be: A. $4,500 FB. $7,110 FC. $7,110 UD. $4,500 U



224. The spending variance for power cost in the flexible budget performance report for the month should be: A. $1,510 FB. $2,770 UC. $1,510 UD. $2,770 F



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225. The spending variance for equipment depreciation in the flexible budget performance report for the month should be: A. $200 UB. $1,120 FC. $200 FD. $1,120 U



Lauter Printing uses two measures of activity, press runs and book set-ups, in the cost formulas in its budgets and performance reports. The cost formula for wages and salaries is $5,300 per month plus $480 per press run plus $1,080 per book set-up. The company expected its activity in October to be 169 press runs and 64 book set-ups, but the actual activity was 167 press runs and 60 book set-ups. The actual cost for wages and salaries in October was $155,690.

226. The wages and salaries in the planning budget for October would be closest to: A. $157,555B. $155,690C. $150,260D. $155,540

$5,300 + $480 x 169 + $1,080 x 64 = $155,540


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227. The wages and salaries in the flexible budget for October would be closest to: A. $155,540B. $155,690C. $150,260D. $153,699

$5,300 + $480 x 167 + $1,080 x 60 = $150,260


228. The activity variance for wages and salaries in October would be closest to: A. $5,280 UB. $150 UC. $150 FD. $5,280 F



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229. The spending variance for wages and salaries in October would be closest to: A. $5,430 UB. $150 UC. $5,430 FD. $150 F



Spraque Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $40,520 per month plus $2,733 per flight plus $11 per passenger. The company expected its activity in June to be 71 flights and 207 passengers, but the actual activity was 70 flights and 205 passengers. The actual cost for plane operating costs in June was $239,580.

230. The plane operating costs in the planning budget for June would be closest to: A. $239,580B. $236,840C. $234,085D. $243,003

$40,520 + $2,733 x 71 + $11 x 207 = $236,840


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231. The plane operating costs in the flexible budget for June would be closest to: A. $233,504B. $234,085C. $239,580D. $236,840

$40,520 + $2,733 x 70 + $11 x 205 = $234,085


232. The activity variance for plane operating costs in June would be closest to: A. $2,755 UB. $2,755 FC. $2,740 FD. $2,740 U



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233. The spending variance for plane operating costs in June would be closest to: A. $2,740 UB. $5,495 UC. $5,495 FD. $2,740 F



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Essay Questions

234. Immen Corporation bases its budgets on the activity measure customers served. During May, the company planned to serve 38,000 customers. The company has provided the following data concerning the formulas its uses in its budgeting:

The company has also furnished its income statement for May:

Required:

Prepare a report showing the company's activity variances for May. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

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235. Faggs Corporation bases its budgets on the activity measure customers served. During December, the company planned to serve 33,000 customers, but actually served 36,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare a report showing the company's activity variances for December. Indicate in each case whether the variance is favorable (F) or unfavorable (U).


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236. Brynteson Corporation bases its budgets on the activity measure customers served. During September, the company planned to serve 24,000 customers, but actually served 19,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $2.90qWages and salaries: $24,700 + $0.90qSupplies: $0.40qInsurance: $4,900Miscellaneous: $2,800 + $0.10q

Required:

Prepare a report showing the company's activity variances for September. Indicate in each case whether the variance is favorable (F) or unfavorable (U).


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237. Domin Corporation bases its budgets on the activity measure customers served. During April, the company planned to serve 31,000 customers, but actually served 35,000 customers. Revenue is $4.80 per customer served. Wages and salaries are $33,000 per month plus $1.60 per customer served. Supplies are $1.00 per customer served. Insurance is $12,200 per month. Miscellaneous expenses are $7,400 per month plus $0.20 per customer served.

Required:

Prepare a report showing the company's activity variances for April. Indicate in each case whether the variance is favorable (F) or unfavorable (U).


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238. Fasano Clinic bases its budgets on the activity measure patient-visits. During April, the clinic planned for 3,800 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

The clinic has also furnished its income statement for April:

Required:

Prepare a report showing the clinic's activity variances for April.

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239. Mulvehill Clinic bases its budgets on the activity measure patient-visits. During June, the clinic planned for 3,000 patient-visits, but the actual level of activity was 3,400 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:


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240. Mccarter Clinic bases its budgets on the activity measure patient-visits. During April, the clinic planned for 2,700 patient-visits, but its actual level of activity was 2,400 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare a report showing the clinic's activity variances for April. Indicate in each case whether the variance is favorable (F) or unfavorable (U).

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241. Delamarter Clinic bases its budgets on the activity measure patient-visits. During June, the clinic planned for 2,600 patient-visits, but its actual level of activity was 3,100 patient-visits. Revenue should be $53.40 per patient-visit. Personnel expenses should be $39,700 per month plus $12.60 per patient-visit. Medical supplies should be $1,800 per month plus $10.40 per patient-visit. Occupancy expenses should be $8,200 per month plus $2.30 per patient-visit. Administrative expenses should be $6,100 per month plus $0.20 per patient-visit.

Required:



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242. Alicuben Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for October was based on 2,200 meals, but the diner actually served 2,000 meals. The diner's director has provided the following cost formulas to use in budgets:


Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for October. Label each variance as favorable (F) or unfavorable (U).

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243. Aslanian Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for November was based on 2,200 meals, but the diner actually served 2,700 meals. The diner's director has provided the following cost formulas to use in budgets:

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for November. Label each variance as favorable (F) or unfavorable (U). Label each variance as favorable (F) or unfavorable (U).


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244. Mulry Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for September was based on 3,000 meals, but the diner actually served 2,800 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.45 per meal; kitchen operations, $4,900 per month plus $1.65 per meal; administrative expenses, $3,600 per month plus $0.60 per meal; and fundraising expenses, $1,200 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for September.

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245. Flicker Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for December was based on 2,400 meals, but the diner actually served 2,300 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.00 per meal; kitchen operations, $5,100 per month plus $1.85 per meal; administrative expenses, $2,900 per month plus $0.65 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare a report showing the activity variances for each of the expenses and for total expenses for December. Label each variance as favorable (F) or unfavorable (U).


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246. Lakey Corporation uses customers served as its measure of activity. During July, the company budgeted for 33,000 customers, but actually served 34,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July:

Required:

Prepare a report showing the company's revenue and spending variances for July. Label each variance as favorable (F) or unfavorable (U).

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247. Mieras Corporation uses customers served as its measure of activity. During January, the company budgeted for 37,000 customers, but actually served 36,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:



Required:

Prepare a report showing the company's revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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248. Fuquay Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $4.80 per customer served. Wages and salaries should be $26,500 per month plus $1.70 per customer served. Supplies should be $0.90 per customer served. Insurance should be $7,100 per month. Miscellaneous expenses should be $4,700 per month plus $0.20 per customer served.

The company reported the following actual results for May:

Required:

Prepare a report showing the company's revenue and spending variances for May. Label each variance as favorable (F) or unfavorable (U).

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249. Kary Clinic uses patient-visits as its measure of activity. During May, the clinic budgeted for 3,800 patient-visits, but its actual level of activity was 4,100 patient-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for May:

Required:

Prepare a report showing the clinic's revenue and spending variances for May. Label each variance as favorable (F) or unfavorable (U).

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250. Gasco Clinic uses patient-visits as its measure of activity. During August, the clinic budgeted for 2,000 patient-visits, but its actual level of activity was 2,100 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:

Revenue: $62.90qPersonnel expenses: $28,500 + $20.40qMedical supplies: $1,400 + $9.90qOccupancy expenses: $8,200 + $3.30qAdministrative expenses: $4,000 + $0.40q

The clinic reported the following actual results for August:

Required:

Prepare a report showing the clinic's revenue and spending variances for August. Label each variance as favorable (F) or unfavorable (U).

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251. Braseth Clinic uses patient-visits as its measure of activity. The clinic bases its budgets on the following information: Revenue should be $39.90 per patient-visit. Personnel expenses should be $35,400 per month plus $13.00 per patient-visit. Medical supplies should be $1,100 per month plus $4.90 per patient-visit. Occupancy expenses should be $8,400 per month plus $2.00 per patient-visit. Administrative expenses should be $4,700 per month plus $0.20 per patient-visit.

The clinic reported the following actual results for January:

Required:

Prepare a report showing the clinic's revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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252. Villella Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for October was based on 3,800 meals. The diner's director has provided the following cost formulas to use in budgets:


Required:

Prepare a report showing the spending variances for each of the expenses and for total expenses for October. Label each variance as favorable (F) or unfavorable (U).

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253. Garing Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for March was based on 3,600 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.20 per meal; kitchen operations, $4,300 per month plus $1.90 per meal; administrative expenses, $3,300 per month plus $0.20 per meal; and fundraising expenses, $1,000 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:

Prepare a report showing the diner's spending variances for each of the expenses and for total expenses for March. Label each variance as favorable (F) or unfavorable (U).

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254. Legorreta Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of November:

Required:

Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

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AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Learning Objective: 4Learning Objective: 6Level: Medium

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255. Duell Clinic uses patient-visits as its measure of activity. The following report compares the planning budget to the actual operating results for the month of January:

Required:

Prepare the clinic's flexible budget performance report for January. Label each variance as favorable (F) or unfavorable (U).

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AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 1Learning Objective: 4Learning Objective: 6Level: Medium

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256. Squillace Corporation uses customers served as its measure of activity. During October, the company budgeted for 38,000 customers, but actually served 35,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October:

Required:

Prepare the company's flexible budget performance report for October. Label each variance as favorable (F) or unfavorable (U).

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257. Guy Corporation uses customers served as its measure of activity. During January, the company budgeted for 32,000 customers, but actually served 35,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:



Required:

Prepare the company's flexible budget performance report for January. Label each variance as favorable (F) or unfavorable (U).

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258. Cotillo Corporation uses customers served as its measure of activity. During December, the company budgeted for 29,000 customers, but actually served 27,000 customers. The company bases its budgets on the following information: Revenue should be $4.40 per customer served. Wages and salaries should be $33,300 per month plus $1.80 per customer served. Supplies should be $0.60 per customer served. Insurance should be $8,900 per month. Miscellaneous expenses should be $4,600 per month plus $0.10 per customer served. The company reported the following actual results for December:

Required:

Prepare the company's flexible budget performance report for December. Label each variance as favorable (F) or unfavorable (U).

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259. Thews Clinic uses patient-visits as its measure of activity. During August, the clinic budgeted for 2,000 patient-visits, but its actual level of activity was 2,200 patient-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:

Required:

Prepare the clinic's flexible budget performance report for August. Label each variance as favorable (F) or unfavorable (U).

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260. Mcgannon Clinic uses patient-visits as its measure of activity. During November, the clinic budgeted for 3,700 patient-visits, but its actual level of activity was 4,100 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:


The clinic reported the following actual results for November:

Required:

Prepare the clinic's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

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261. Vernon Clinic uses patient-visits as its measure of activity. During February, the clinic budgeted for 3,100 patient-visits, but its actual level of activity was 2,800 patient-visits. The clinic bases its budgets on the following information: Revenue should be $30.20 per patient-visit. Personnel expenses should be $20,600 per month plus $9.70 per patient-visit. Medical supplies should be $1,400 per month plus $5.40 per patient-visit. Occupancy expenses should be $5,700 per month plus $1.50 per patient-visit. Administrative expenses should be $2,500 per month plus $0.30 per patient-visit. The clinic reported the following actual results for February:

Required:

Prepare the clinic's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U).

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262. Gamon Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for April was based on 3,600 meals. The diner's director has provided the following cost formulas to use in budgets:


Required:


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263. Wrape Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for April was based on 2,100 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.55 per meal; kitchen operations, $4,700 per month plus $1.70 per meal; administrative expenses, $3,300 per month plus $0.60 per meal; and fundraising expenses, $1,000 per month. The director has also provided the diner's statement of actual expenses for the month:

Required:


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264. Hausman Hospital bases its budgets on patient-visits. The hospital's static planning budget for October appears below:

Required:

Prepare a flexible budget for 8,900 patient-visits per month.


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265. Turiano Corporation bases its budgets on machine-hours. The company's static planning budget for November appears below:

Required:

Prepare a flexible budget for 9,800 machine-hours per month.


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266. Therrien Corporation bases its budgets on the activity measure customers served. During September, the company plans to serve 30,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the company's planning budget for September.


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267. During March, Holston Corporation plans to serve 31,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:


Required:

Prepare the company's planning budget for March.


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268. During August, Klinck Corporation plans to serve 33,000 customers. Revenue is $2.50 per customer served. Wages and salaries are $24,300 per month plus $0.90 per customer served. Supplies are $0.30 per customer served. Insurance is $7,100 per month. Miscellaneous expenses are $5,200 per month plus $0.10 per customer served.

Required:

Prepare the company's planning budget for August.


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269. Novielli Corporation bases its budgets on the activity measure customers served. During November, the company planned to serve 39,000 customers, but actually served 44,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the company's flexible budget for November based on the actual level of activity for the month.


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270. During September, Booker Corporation budgeted for 20,000 customers, but actually served 22,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:


Required:

Prepare the company's flexible budget for September based on the actual level of activity for the month.


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271. During July, Bosell Corporation budgeted for 22,000 customers, but actually served 21,000 customers. Revenue should be $6.80 per customer served. Wages and salaries should be $35,900 per month plus $2.40 per customer served. Supplies should be $1.20 per customer served. Insurance should be $12,000 per month. Miscellaneous expenses should be $6,000 per month plus $0.30 per customer served.

Required:

Prepare the company's flexible budget for July based on the actual level of activity for the month.


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272. Gramling Clinic bases its budgets on patient-visits. During July, the clinic plans for a level of activity of 2,500 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:

Prepare the clinic's planning budget for July.


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273. During September, Noaks Clinic plans for an activity level of 3,300 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits: Revenue: $30.50qPersonnel expenses: $30,900 + $8.40qMedical supplies: $1,200 + $4.50qOccupancy expenses: $6,400 + $1.70qAdministrative expenses: $3,700 + $0.10q

Required:

Prepare the clinic's planning budget for September.


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274. During June, Defee Clinic plans for an activity level of 3,200 patient-visits. Revenue is $50.80 per patient-visit. Personnel expenses are $35,300 per month plus $16.70 per patient-visit. Medical supplies are $1,400 per month plus $8.50 per patient-visit. Occupancy expenses are $12,500 per month plus $2.60 per patient-visit. Administrative expenses are $7,200 per month plus $0.20 per patient-visit.

Required:

Prepare the clinic's planning budget for June.


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275. Clune Clinic bases its budgets on the activity measure patient-visits. During October, the clinic planned for an activity level of 2,100 patient-visits, but the activity level was actually 2,600 patient-visits. The clinic has provided the following data concerning the formulas it uses in its budgeting:

Required:



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276. During October, Moceri Clinic budgeted for 3,000 patient-visits, but its actual level of activity was 3,500 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:


Required:



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277. During May, Phong Clinic budgeted for 2,900 patient-visits, but its actual level of activity was 3,100 patient-visits. Revenue should be $31.30 per patient-visit. Personnel expenses should be $23,700 per month plus $8.10 per patient-visit. Medical supplies should be $700 per month plus $6.20 per patient-visit. Occupancy expenses should be $7,000 per month plus $1.50 per patient-visit. Administrative expenses should be $3,400 per month plus $0.40 per patient-visit.

Required:

Prepare the clinic's flexible budget for May based on the actual level of activity for the month.


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278. Vilanova Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for May is to be based on 2,700 meals. The diner's director has provided the following cost formulas to use in the budget:

Required:

Prepare the diner's budget for the month of May. The budget will only contain the costs listed above; no revenues will be on the budget.


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279. Mcduffey Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for September was based on 2,900 meals, but the diner actually served 2,800 meals. The diner's director has provided the following cost formulas to use in budgets:

Required:

Prepare the diner's flexible budget for the actual number of meals served in September. The budget will only contain the costs listed above; no revenues will be on the budget.


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280. Korando Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for June is to be based on 2,900 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.60 per meal; kitchen operations, $4,200 per month plus $1.15 per meal; administrative expenses, $2,800 per month plus $0.65 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare the diner's budget for the month of June. The budget will only contain the costs listed above; no revenues will be on the budget.


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281. Salvia Urban Diner is a charity supported by donations that provides free meals to the homeless. The diner's budget for May was based on 3,400 meals, but the diner actually served 3,700 meals. The diner's director has provided the following cost data to use in the budget: groceries, $2.90 per meal; kitchen operations, $4,100 per month plus $1.90 per meal; administrative expenses, $2,400 per month plus $0.20 per meal; and fundraising expenses, $1,000 per month.

Required:

Prepare the diner's flexible budget for the actual number of meals served in May. The budget will only contain the costs listed above; no revenues will be on the budget.


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282. Alarie Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:


Required:

Prepare a report showing the school's activity variances for November. Label each variance as favorable (F) or unfavorable (U).


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283. Eisner Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In October, the school budgeted for 1,490 students and 85 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the school's activity variances for October. Label each variance as favorable (F) or unfavorable (U).

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AACSB: AnalyticAICPA BB: Critical ThinkingAICPA FN: MeasurementLearning Objective: 2Learning Objective: 5Level: Hard

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284. Bures Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In April, the company budgeted for 360 guests and 134 jeeps. The actual activity for the month was 335 guests and 136 jeeps.

Required:


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285. Mashore Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In April, the company budgeted for 495 guests and 187 jeeps. The company's income statement showing the actual results for the month appears below:

Required:


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286. Ahrns Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In July, the school budgeted for 1,770 students and 148 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the school's revenue and spending variances for July. Label each variance as favorable (F) or unfavorable (U).

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287. Ruvolo Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In February, the company budgeted for 436 guests and 162 jeeps. The company's income statement showing the actual results for the month appears below:

Required:

Prepare a report showing the company's revenue and spending variances for February. Label each variance as favorable (F) or unfavorable (U).

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288. Brink Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In June, the school budgeted for 1,710 students and 110 courses. The school's income statement showing the actual results for the month appears below:

Required:

Prepare a flexible budget performance report showing both the school's activity variances and revenue and spending variances for June. Label each variance as favorable (F) or unfavorable (U).

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289. Palamino Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In January, the company budgeted for 330 guests and 143 jeeps. The company's income statement showing the actual results for the month appears below:

Required:

Prepare a flexible budget performance report showing both the company's activity variances and revenue and spending variances for January. Label each variance as favorable (F) or unfavorable (U).

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290. Alto Clinic uses patient-visits as its measure of activity. The clinic has provided the following report:

Required:

Prepare the clinic's flexible budget performance report for June. Label each variance as favorable (F) or unfavorable (U).

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291. Drobot Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:


Required:

Prepare the school's planning budget for November.


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292. Hasselman Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting:

In January, the school budgeted for 1,110 students and 105 courses. The actual activity for the month was 1,210 students and 103 courses.

Required:

Prepare the school's flexible budget for the actual level of activity in January.


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293. Lantrip Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In January, the company budgeted for 356 guests and 174 jeeps. The actual activity for the month was 341 guests and 177 jeeps.

Required:

Prepare the company's planning budget for January.


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294. Karpin Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

In July, the company budgeted for 434 guests and 132 jeeps. The actual activity for the month was 459 guests and 137 jeeps.

Required:

Prepare the company's flexible budget for the actual level of activity in July.


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10 flexible budgets & performance analysis

Documents

individually

computer spreadsheet

analytic aicpa

net operating

enriques corporation

luc corporation

nasson corporation

palczewski