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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 pools monthly planning budget is based on operating 24 vehicles; however, for the month of March the university purchased one additional vehicle. The motor pool furnishes gasoline, oil, and other supplies for its automobiles. A mechanic does routine maintenance and minor repairs. Major repairs are performed at a nearby commercial garage.

The following cost control report shows actual operating costs for March of the current year compared to the planning budget for March.

Boyne University Motor Pool Cost Control Report For the Month Ended March 31
March Actual Planning Budget (Over) Under Budget
Miles 58,400 50,400
Autos 25 24
Gasoline $ 11,053 $ 10,080 $ (973 )
Oil, minor repairs, parts 4,870 4,536 (334 )
Outside repairs 1,230 1,056 (174 )
Insurance 2,020 1,896 (124 )
Salaries and benefits 8,610 8,610 0
Vehicle depreciation 5,100 4,896 (204 )
Total $ 32,883 $ 31,074 $ (1,809 )

The planning budget was based on the following assumptions:
a. $0.20 per mile for gasoline.
b. $0.09 per mile for oil, minor repairs, and parts.
c. $44 per automobile per month for outside repairs.
d. $79 per automobile per month for insurance.
e. $8,610 per month for salaries and benefits.
f. $204 per automobile per month for depreciation.

The supervisor of the motor pool is unhappy with the report, claiming it paints an unfair picture of the motor pools performance.

image text in transcribed

Required: 1. Complete the performance report for March based on a flexible budget that shows spending variances (Round "per mile" answers to 2 decimal places. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Boyne University Motor Pool Spending Variances For the Month Ended March 31 Planning Budget Flexible Actual Spending Variances Budget Assumptions Results 58,400 Miles Autos 11,053 per mile Gasoline 4,870 per mile Oil, minor repairs, parts Outside repairs per automobile 1,230 2,020 Insurance per automobile 8,610 Salaries and benefits per month 5,100 Vehicle depreciation per automobile 32,883 Total

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