Question
The following is total monthly budgeted cost and activity information for the four activity centers in the billing department of Oregon Power Company Activity Center
The following is total 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 |
Statement inquiry | $76,197 | $160,000 | 3,300 labor hours |
Correspondence | $10,052 | $28,000 | 2,800 letters |
Account billing | $182,000 | $84,000 | 2,600,000 lines |
Payment verification | $8,600 | $77,000 | 20,000 accounts |
In September, actual total costs and activity were as follows:
Activity Center | Total Costs | Driver Amount |
Statement inquiry | $236,223 | 3,270 labor hours |
Correspondence | $38,605 | 2,760 letters |
Account billing | $262,958 | 2,550,000 lines |
Payment verification | $85,875 | 20,060 accounts |
Compute the flexible-budget variances for the following two activity cost items (round unit costs to two decimal places and enter favorable variances as positive numbers and unfavorable variances as negative numbers): Statement inquiry Payment verification
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