188) Dure Corporation’s cost formula for its selling and administrative expense is $24,500 per
month plus $1 per unit. For the month of July, the company planned for activity of 7,200 units, but
the actual level of activity was 7,160 units. The actual selling and administrative expense for the
month was $31,460.
The spending variance for selling and administrative expense in July would be closest to:
A) $240 U
B) $200 U
C) $200 F
D) $240 F
189) Ruozzo Corporation is a service company that measures its output by the number of
customers served. The company has provided the following fixed and variable cost estimates that
it uses for budgeting purposes and the actual results of operations for July.
Fixed Element per
Month
Variable Element
per Customer
Served
Revenue
$
4,500
$
100,000
Employee salaries and wages
$
43,100
$
900
$
63,300
Travel expenses
$
500
$
11,500
Other expenses
$
36,900
$
37,900
–
When the company prepared its planning budget at the beginning of July, it assumed that 27
customers would have been served. However, 22 customers were actually served during July.
The “Employee salaries and wages” in the flexible budget for July would have been closest to:
A) $67,400
B) $63,300
C) $77,686
D) $62,900
Flexible
Customers served (q)
Employee salaries and wages ($43,100 + $900q)
–
190) Ruozzo Corporation is a service company that measures its output by the number of
customers served. The company has provided the following fixed and variable cost estimates that
it uses for budgeting purposes and the actual results of operations for July.
Fixed Element per
Month
Variable Element
per Customer
Served
Revenue
$
4,500
$
100,000
Employee salaries and wages
$
43,100
$
900
$
63,300
Travel expenses
$
500
$
11,500
Other expenses
$
36,900
$
37,900
–
When the company prepared its planning budget at the beginning of July, it assumed that 27
customers would have been served. However, 22 customers were actually served during July.
The spending variance for “Travel expenses” for July would have been closest to:
A) $2,000 F
B) $2,000 U
C) $500 F
D) $500 U
Customers served (q)
22
22
Travel expenses ($500q)
$
11,500
U
–
191) Ruozzo Corporation is a service company that measures its output by the number of
customers served. The company has provided the following fixed and variable cost estimates that
it uses for budgeting purposes and the actual results of operations for July.
Fixed Element per
Month
Variable Element
per Customer
Served
Revenue
$
4,500
$
100,000
Employee salaries and wages
$
43,100
$
900
$
63,300
Travel expenses
$
500
$
11,500
Other expenses
$
36,900
$
37,900
When the company prepared its planning budget at the beginning of July, it assumed that 27
customers would have been served. However, 22 customers were actually served during July.
The amount shown for net operating income in the planning budget for July would have been
closest to:
A) ($12,700)
B) ($15,586)
C) ($11,800)
D) $3,700
Customers served (q)
Revenue ($4,500q)
Expenses:
Employee salaries and wages ($43,100 + $900q)
Travel expenses ($500q)
Other expenses ($36,900)
Total expenses
Net operating income
–
192) Ruozzo Corporation is a service company that measures its output by the number of
customers served. The company has provided the following fixed and variable cost estimates that
it uses for budgeting purposes and the actual results of operations for July.
Fixed Element per
Month
Variable Element
per Customer
Served
Revenue
$
4,500
$
100,000
Employee salaries and wages
$
43,100
$
900
$
63,300
Travel expenses
$
500
$
11,500
Other expenses
$
36,900
$
37,900
–
When the company prepared its planning budget at the beginning of July, it assumed that 27
customers would have been served. However, 22 customers were actually served during July.
The activity variance for net operating income for July would have been closest to:
A) $16,400 F
B) $15,500 F
C) $15,500 U
D) $16,400 U
Customers served (q)
Revenue ($4,500q)
99,000
$
121,500
22,500
U
Expenses:
Employee salaries and wages
($43,100 + $900q)
Travel expenses ($500q)
11,000
13,500
2,500
F
Other expenses ($36,900)
36,900
36,900
Total expenses
110,800
117,800
7,000
F
Net operating income
)
$
15,500
U
193) Milot Corporation is an oil well service company that measures its output by the number of
wells serviced. The company has provided the following fixed and variable cost estimates that it
uses for budgeting purposes and the actual results of operations for April.
Fixed Element per
Month
Variable Element
per Well Serviced
Revenue
$
3,800
$
112,900
Employee salaries and wages
$
41,400
$
900
$
69,500
Servicing materials
$
500
$
15,100
Other expenses
$
29,600
$
30,200
–
When the company prepared its planning budget at the beginning of April, it assumed that 32 wells
would have been serviced. However, 29 wells were actually serviced during April.
The amount shown for revenue in the planning budget for April would have been closest to:
A) $110,200
B) $121,600
C) $112,900
D) $124,579
Wells serviced (q)
Revenue ($3,800q)
$
–
194) Milot Corporation is an oil well service company that measures its output by the number of
wells serviced. The company has provided the following fixed and variable cost estimates that it
uses for budgeting purposes and the actual results of operations for April.
Fixed Element per
Month
Variable Element
per Well Serviced
Revenue
$
3,800
$
112,900
Employee salaries and wages
$
41,400
$
900
$
69,500
Servicing materials
$
500
$
15,100
Other expenses
$
29,600
$
30,200
–
When the company prepared its planning budget at the beginning of April, it assumed that 32 wells
would have been serviced. However, 29 wells were actually serviced during April.
The “Servicing materials” in the flexible budget for April would have been closest to:
A) $16,000
B) $16,662
C) $14,500
D) $15,100
Wells serviced (q)
Servicing materials ($500q)
$
–
195) Milot Corporation is an oil well service company that measures its output by the number of
wells serviced. The company has provided the following fixed and variable cost estimates that it
uses for budgeting purposes and the actual results of operations for April.
Fixed Element per
Month
Variable Element
per Well Serviced
Revenue
$
3,800
$
112,900
Employee salaries and wages
$
41,400
$
900
$
69,500
Servicing materials
$
500
$
15,100
Other expenses
$
29,600
$
30,200
–
When the company prepared its planning budget at the beginning of April, it assumed that 32 wells
would have been serviced. However, 29 wells were actually serviced during April.
The activity variance for total expenses for April would have been closest to:
A) $4,200 F
B) $1,000 F
C) $1,000 U
D) $4,200 U
Budget
Budget
Variances
Wells serviced (q)
Expenses:
Employee salaries and wages
($41,400 + $900q)
F
Servicing materials ($500q)
14,500
16,000
1,500
F
Other expenses ($29,600)
29,600
29,600
0
Total expenses
$
$
115,800
$
4,200
F
–
196) Milot Corporation is an oil well service company that measures its output by the number of
wells serviced. The company has provided the following fixed and variable cost estimates that it
uses for budgeting purposes and the actual results of operations for April.
Fixed Element per
Month
Variable Element
per Well Serviced
Revenue
$
3,800
$
112,900
Employee salaries and wages
$
41,400
$
900
$
69,500
Servicing materials
$
500
$
15,100
Other expenses
$
29,600
$
30,200
–
When the company prepared its planning budget at the beginning of April, it assumed that 32 wells
would have been serviced. However, 29 wells were actually serviced during April.
The spending variance for “Other expenses” for April would have been closest to:
A) $600 F
B) $3,124 F
C) $3,124 U
D) $600 U
Budget
Wells serviced (q)
29
Other expenses ($29,600)
30,200
29,600
$
600
U
–
197) Courington Detailing’s cost formula for its materials and supplies is $2,420 per month plus $9
per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the
actual level of activity was 33 vehicles. The actual materials and supplies for the month was
$2,840.
The materials and supplies in the planning budget for August would be closest to:
A) $5,422
B) $2,840
C) $2,987
D) $2,717
198) Courington Detailing’s cost formula for its materials and supplies is $2,420 per month plus $9
per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the
actual level of activity was 33 vehicles. The actual materials and supplies for the month was
$2,840.
The materials and supplies in the flexible budget for August would be closest to:
A) $1,565
B) $2,717
C) $2,987
D) $2,840
199) Courington Detailing’s cost formula for its materials and supplies is $2,420 per month plus $9
per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the
actual level of activity was 33 vehicles. The actual materials and supplies for the month was
$2,840.
The activity variance for materials and supplies in August would be closest to:
A) $270 U
B) $270 F
C) $147 U
D) $147 F
200) Courington Detailing’s cost formula for its materials and supplies is $2,420 per month plus $9
per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the
actual level of activity was 33 vehicles. The actual materials and supplies for the month was
$2,840.
The spending variance for materials and supplies in August would be closest to:
A) $147 F
B) $123 F
C) $123 U
D) $147 U
201) Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic
budgeted for 3,500 client-visits, but its actual level of activity was 3,490 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for January:
Data used in budgeting:
Fixed element
per month
Variable element
per client-visit
Revenue
–
$
38.20
Personnel expenses
$
33,600
$
11.00
Medical supplies
1,900
6.20
Occupancy expenses
10,200
1.90
Administrative expenses
6,600
0.30
Total expenses
$
52,300
$
19.40
Actual results for January:
Revenue
$
127,218
Personnel expenses
$
71,860
Medical supplies
$
24,058
Occupancy expenses
$
17,371
Administrative expenses
$
7,547
The net operating income in the planning budget for January would be closest to:
A) $13,312
B) $13,500
C) $6,400
D) $6,364
Revenue per client-visit
$
38.20
Total variable expense per client-visit
Contribution margin per client-visit
$
Total fixed expense
$
52,300
202) Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic
budgeted for 3,500 client-visits, but its actual level of activity was 3,490 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for January:
Data used in budgeting:
Fixed element
per month
Variable element
per client-visit
Revenue
–
$
38.20
Personnel expenses
$
33,600
$
11.00
Medical supplies
1,900
6.20
Occupancy expenses
10,200
1.90
Administrative expenses
6,600
0.30
Total expenses
$
52,300
$
19.40
Actual results for January:
Revenue
$
127,218
Personnel expenses
$
71,860
Medical supplies
$
24,058
Occupancy expenses
$
17,371
Administrative expenses
$
7,547
The net operating income in the flexible budget for January would be closest to:
A) $6,364
B) $13,500
C) $13,312
D) $6,400
Revenue per client-visit
$
38.20
Total variable expense per client-visit
Contribution margin per client-visit
$
Total fixed expense
$
52,300
175
203) Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic
budgeted for 3,500 client-visits, but its actual level of activity was 3,490 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for January:
Data used in budgeting:
Fixed element
per month
Variable element
per client-visit
Revenue
–
$
38.20
Personnel expenses
$
33,600
$
11.00
Medical supplies
1,900
6.20
Occupancy expenses
10,200
1.90
Administrative expenses
6,600
0.30
Total expenses
$
52,300
$
19.40
Actual results for January:
Revenue
$
127,218
Personnel expenses
$
71,860
Medical supplies
$
24,058
Occupancy expenses
$
17,371
Administrative expenses
$
7,547
The activity variance for net operating income in January would be closest to:
A) $188 F
B) $7,118 F
C) $188 U
D) $7,118 U
177
204) Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic
budgeted for 3,500 client-visits, but its actual level of activity was 3,490 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for January:
Data used in budgeting:
Fixed element
per month
Variable element
per client-visit
Revenue
–
$
38.20
Personnel expenses
$
33,600
$
11.00
Medical supplies
1,900
6.20
Occupancy expenses
10,200
1.90
Administrative expenses
6,600
0.30
Total expenses
$
52,300
$
19.40
–
Actual results for January:
Revenue
$
127,218
Personnel expenses
$
71,860
Medical supplies
$
24,058
Occupancy expenses
$
17,371
Administrative expenses
$
7,547
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) $7,118 U
B) $6,930 U
C) $6,930 F
D) $7,118 F
205) Tennies Clinic uses client-visits as its measure of activity. During November, the clinic
budgeted for 3,300 client-visits, but its actual level of activity was 3,290 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for November:
Data used in budgeting:
Fixed Element
per Month
Variable element
per client-visit
Revenue
–
$
35.40
Personnel expenses
$
29,500
$
10.40
Medical supplies
1,200
5.80
Occupancy expenses
7,600
1.90
Administrative expenses
5,900
0.30
Total expenses
$
44,200
$
18.40
–
Actual results for November:
Revenue
$
116,656
Personnel expenses
$
63,686
Medical supplies
$
21,072
Occupancy expenses
$
13,371
Administrative expenses
$
6,677
The administrative expenses in the planning budget for November would be closest to:
A) $6,887
B) $6,677
C) $6,697
D) $6,890
206) Tennies Clinic uses client-visits as its measure of activity. During November, the clinic
budgeted for 3,300 client-visits, but its actual level of activity was 3,290 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results
for November:
Data used in budgeting:
Fixed element
per month
Variable element
per client-visit
Revenue
–
$
35.40
Personnel expenses
$
29,500
$
10.40
Medical supplies
1,200
5.80
Occupancy expenses
7,600
1.90
Administrative expenses
5,900
0.30
Total expenses
$
44,200
$
18.40
–
Actual results for November:
Revenue
$
116,656
Personnel expenses
$
63,686
Medical supplies
$
21,072
Occupancy expenses
$
13,371
Administrative expenses
$
6,677
The medical supplies in the flexible budget for November would be closest to:
A) $20,340
B) $20,282
C) $21,008
D) $21,136