26-29

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			$	5,700		$	209,500
Employee salaries and wages	$	64,000	$	1,100		$	106,400
Travel expenses			$	560		$	19,000
Other expenses	$	43,000				$	40,700

When preparing its planning budget the company estimated that it would serve 35 customers per month; however, during May the company actually served 40 customers.

5. What net operating income would appear in Adgers flexible budget for May?

6. What is Adgers revenue variance for May?

7. What is Adgers employee salaries and wages spending variance for May?

8. What is Adgers travel expenses spending variance for May?