1. Trevorrow 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 6,200 units, but its actual level of activity was 6,160 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June:

Data used in budgeting:

	Fixed element per month			Variable element per unit
Revenue		-		$	27.80
Direct labor	$	0		$	3.10
Direct materials		0			10.20
Manufacturing overhead		37,200			1.10
Selling and administrative expenses		22,800			0.30
Total expenses	$	60,000		$	14.70

Actual results for June:

Revenue	$	178,318
Direct labor	$	18,606
Direct materials	$	60,652
Manufacturing overhead	$	43,896
Selling and administrative expenses	$	24,688

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 June would be closest to:

Multiple Choice

• $9,256 U

• $9,256 F

• $9,780 U

• $9,780 F

2. Neeb 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 7,000 units, but its actual level of activity was 7,040 units. The company 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 unit
Revenue		-		$	27.20
Direct labor	$	0		$	3.20
Direct materials		0			9.70
Manufacturing overhead		44,300			1.10
Selling and administrative expenses		27,000			0.40
Total expenses	$	71,300		$	14.40

Actual results for January:

Revenue	$	183,448
Direct labor	$	23,178
Direct materials	$	68,808
Manufacturing overhead	$	49,784
Selling and administrative expenses	$	30,246

The spending variance for manufacturing overhead in January would be closest to:

Multiple Choice

• $2,216 U

• $2,260 F

• $2,260 U

• $2,216 F