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Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below:

	Fixed Element per Month		Variable Element per Customer Served		Actual Total for May
Revenue			$	5,000	$	160,000
Employee salaries and wages	$	50,000	$	1,100	$	88,000
Travel expenses			$	600	$	19,000
Other expenses	$	36,000			$	34,500

When preparing its planning budget the company estimated that it would serve 30 customers per month; however, during May the company actually served 35 customers.

1. What amount of revenue would be included in Adgers planning budget for May?

	Revenue: Variable element per customer served Planned level of activity Amount in planning budget

2.

What amount of employee salaries and wages would be included in Adgers planning budget for May?

	Employee salaries and wages: Variable element per customer served Planned activity Variable portion of the amount Fixed element per month Amount in planning budget $0

3.

What amount of travel expenses would be included in Adgers planning budget for May?

	Travel expenses: Variable element per customer served Planned activity Amount in planning budget

4.

.	What amount of other expenses would be included in Adgers planning budget for May? 5.

What activity variance would Adger report in May with respect to its revenue? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

	Flexible Budget Activity Variance Planning Budget

6. What activity variances would Adger report with respect to each of its expenses? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

	Flexible Budget Activity Variance Planning Budget Employee salaries and wages Travel expenses Other expenses

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