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TB Problem Qu. 9-373 Varriano Corporation bases its budgets on... Varriano Corporation bases its budgets...

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Accounting

TB Problem Qu. 9-373 Varriano Corporation bases its budgets on...

Varriano Corporation bases its budgets on the activity measure customers served. During October, the company planned to serve 36,000 customers, but actually served 34,000 customers. The company has provided the following data concerning the formulas it uses in its budgeting:

Fixed element per month Variable element per customer
Revenue - $ 3.81
Wages and salaries $ 37,000 $ 1.21
Supplies $ 0 $ 0.51
Insurance $ 8,000 $ 0.00
Miscellaneous expense $ 7,000 $ 0.41

Required:

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

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Varriano Corporation Activity Variances For the Month Ended October 31 Flexible Planning Budget Budget 34,000 36,000 Activity Variances Customers served Revenue Expenses: Wages and salaries Supplies Insurance Miscellaneous expense Total expense Net operating income

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