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Boyne University offers an extensive continuing education program in many cities throughout the state. For the convenience of Its faculty and administrative staff and to
Boyne University offers an extensive continuing education program in many cities throughout the state. For the convenience of Its faculty and administrative staff and to save costs, the university operates a motor pool. The motor pool's monthly planning budget is based on operating 16 vehicles; however, for the month of March the university purchased one additional vehicle. The motor pool furnishes gasoline, oll, and other supplies for its automobiles. A mechanic does routine maintenance and minor repalrs. Major repalrs are performed at a nearby commerclal garage. The following cost control report shows actual operating costs for March of the current year compared to the planning budget for March. The planning budget was based on the following assumptions: a. $0.16 per mile for gasoline. b. $0.05 per mile for oll, minor repairs, and parts. c. $31 per automobile per month for outside repairs. d. $67 per automobile per month for Insurance. e. $8,610 per month for salarles and benefits. f. $192 per automobile per month for depreclation. The supervisor of the motor pool Is unhappy with the report, claiming it paints an unfalr picture of the motor pool's performance. Required: 1. Calculate the spending varlances for March. (Indlcate the effect of each varlance by selectling "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero varlance). Input all amounts as positlve values.)
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