In this problem, you must create the flexible budget and flexible budget variances for two cost items. I suggest the following steps for each item: determine the cost function for the two items plug in the appropriate activity amount and compute the budget subtract the actual cost and compute the variance. Be sure to follow the instructions about the sign that you should enter with your numerical answer. There is no partial credit - you must get both variances correct in order to get the full 10 points. ______________________________________________________ The following is monthly budgeted cost and activity information for the four activity centers in the billing department of Oregon Power Company: Activity Center Variable Fixed Cost Driver Account inquiry $79,264 $157,000 3,200 labor hours Correspondence $9,976 $25,000 2,900 letters Account billing $144,000 $77,000 2,400,000 lines Bill verification $11,440 $76,000 22,000 accounts In September, actual costs and activity were as follows: Activity Center Total Costs Driver Amount Account inquiry $234,118 3,090 labor hours Correspondence $35,170 2,950 letters Account billing $214,883 2,290,000 lines Bill verification $87,797 21,960 accounts Required Compute the flexible-budget variances for the following two activity cost items (round all answers to the nearest dollar and enter favorable variances as positive numbers and unfavorable variances as negative numbers): Account billing Account inquiry