chapter 9

Calculate the spending variances for March. (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 offers an extensive continuing education program In many citles throughout the state. For the convenience of Its faculty and adminlstrative staff and to save costs, the university operates a motor pool. The motor pool's monthly planning budget Is based on operating 18 vehicles; however, for the month of March the university purchased one additional vehicle. The motor pool furnishes gasoline, oll, and other supplies for Its automoblles. A mechanic does routine maintenance and minor repalis. 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. \$0.12 per mile for gasoline. b. $0.09 per mile for oll, minor repalrs, and parts. c. $33 per automobile per month for outside repairs. d. $69 per automobile per month for Insurance. e. $8,610 per month for salarles and benefits. f. \$194 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.) You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you revlew the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step In overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Durlng March, the company worked 17,000 machine-hours and produced 11,000 units. The company had originally planned to work 19,000 machine-hours during March. Requlred: 1. Calculate the actlvity varlances for March. 2. Calculate the spending varlances for March. Complete this question by entering your answers in the tabs below. Calculate the activity variances for March. (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.) Vulcan Flyovers offers scenlc overfilghts of Mount Saint Helens, the volcano In Washington State that explosively erupted In 1982. Data concerning the company's operations in July appear below: The company measures its activity in terms of flights. Customers can buy Individual tickets for overfilghts or hire an entire plane for an overflight at a discount. Required: 1. Prepare a flexible budget performance report for July that Includes revenue and spending varlances and actlvity varlances. (Indlcate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero varlance). Input all amounts as positive values.) AlrQual Test Corporation provides on-site alr quality testing services. The company has provided the following cost formulas and actual results for the month of February: The company uses the number of jobs as its measure of actlvity. For example, moblle lab operating expenses should be $4,700 plus $31 per job, and the actual mobile lab operating expenses for February were $9,190. The company expected to work 150 jobs in February, but actually worked 156 Jobs. Requlred: Prepare a flexible budget performance report showing AlrQual Test Corporation's revenue and spending varlances and actlvity varlances for February. (Indlcate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero varlance). Input all amounts as positlve values.)