1. Assume that the amount of one of a companys variable expenses in its flexible budget is $40,000. The actual amount of the expense is $41,800 and the amount in the companys planning budget is $44,000. The spending variance for this expense is:

2. Assume that a company provided the following cost formulas for three of its expenses (where q refers to the number of hours worked):

Rent (fixed)		$3,000
Supplies (variable)		$4.00 q
Utilities (mixed)		$150 + $0.75q

The companys planned level of activity was 2,160 hours and its actual level of activity was 1,850 hours. How much supplies expense would be included in the planning budget?

1. $8,040
2. $8,340
3. $8,540
4. $8,640