Cicchetti Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of December:

Cicchetti Corporation Comparison of Actual Results to Planning Budget For the Month Ended December 31

Actual Results

Planning Budget

Variances

Customers served

38,000

37,000

Revenue (3.50q)

$

133,800

$

129,500

$

4,300

F

Expenses:

Wages and salaries ($23,700 + $1.27q)

71,960

70,690

1,270

U

Supplies ($0.67q)

22,290

24,790

2,500

F

Insurance ($5,600)

5,600

5,600

0

Miscellaneous expense ($4,600 + $.36q)

15,420

17,920

2,500

F

Total expense

115,270

119,000

3,730

F

Net operating income

$

18,530

$

10,500

$

8,030

F

Required:

1.

Prepare a report showing the companys revenue and spending variances for December. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

CICCHETTI CORPORATION
Revenue and Spending Variances
For the Month Ended December 31
	Actual Results	Revenue and Spending Variances		Flexible Budget
Customers served	38,000
Revenue	$133,800
Expenses:
Wages and salaries	71,960
Supplies	22,290
Insurance	5,600
Miscellaneous expense	15,420
Total expense	115,270			0
Net operating income	$18,530			$0