Cadavieco Detailing\'s cost formula for its materials and supplies is $2,030 per
ID: 2379498 • Letter: C
Question
Cadavieco Detailing's cost formula for its materials and supplies is $2,030 per month plus $8 per vehicle. For the month of November, the company planned for activity of 98 vehicles, but the actual level of activity was 58 vehicles. The actual materials and supplies for the month was $2,760.
Cadavieco Detailing's cost formula for its materials and supplies is $2,030 per month plus $8 per vehicle. For the month of November, the company planned for activity of 98 vehicles, but the actual level of activity was 58 vehicles. The actual materials and supplies for the month was $2,760.
Explanation / Answer
Cost Eqn is 2030 + 8X
where X is no of vehicle
When 98 vehicles was planed. Budget will be 2030+8*98 = $2,814
When 58 vehciles were actual, flexible budget will be 2030+8*58 =$2,494
So Activity Variance is Budggetd-Actual = $2814 - $2,494 = 320F