Question
Borunda Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane
Borunda Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $46,100 per month plus $2,808 per flight plus $14 per passenger. The company expected its activity in July to be 137 flights and 320 passengers, but the actual activity was 141 flights and 316 passengers. The actual cost for plane operating costs in July was $429,080. The activity variance for plane operating costs in July would be closest to:
$11,176 U
$6,196 F
$6,196 U
$11,176 F
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