Item5

Item 5

Assume a company has only one service department and one operating department. The service departments budgeted and actual variable costs for the period were $80,000 and $83,600, respectively. The budgeted and actual units of service provided to the operating department were 40,000 units and 41,000 units, respectively. How much of the service departments variable costs should not be charged to the operating department?

Multiple Choice

$0

$3,600

$1,600

$2,100