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A companys planning and flexible budgets for July appear below (in July, 24,000 meals were actually served): 1 Calculate activity variances for July. 2 Indicate
A companys planning and flexible budgets for July appear below (in July, 24,000 meals were actually served): | ||||
1 Calculate activity variances for July. | ||||
2 Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable. | ||||
Planning Budget | Flexible Budget | |||
For the Month Ended July 31 | For the Month Ended July 31 | |||
Budgeted meals (q) | 23,000 | Budgeted meals (q) | 24,000 | |
Revenue ($4.10q) | 94,300 | Revenue ($4.10q) | 98,400 | |
Expenses: | Expenses: | |||
Raw materials ($1.80q) | 41,400 | Raw materials ($1.80q) | 43,200 | |
Wages and salaries ($6,400 + $0.20q) | 11,000 | Wages and salaries ($6,400+ $0.20q) | 11,200 | |
Utilities ($2,000 + $0.05q) | 3,150 | Utilities ($2,000 + $0.05q) | 3,200 | |
Facility rent ($3,800) | 3,800 | Facility rent ($3,800) | 3,800 | |
Insurance ($2,800) | 2,800 | Insurance ($2,800) | 2,800 | |
Miscellaneous ($600 + $0.10q) | 2,900 | Miscellaneous ($600 + $0.10q) | 3,000 | |
Total expense | 65,050 | Total expense | 67,200 | |
Net operating income | 29,250 | Net operating income | 31,200 |
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