Please help Please help AirQual Test Corporation provides on-ene atr quality tec
ID: 2514651 • Letter: P
Question
Please help Please help AirQual Test Corporation provides on-ene atr quality tecting cervMces. The company has provided the following cost formulas and actual results for the month of February 12 5 277 s960 The company uses the number of jobs as tts measure of activity, For example, mobile lab operating expenses should be $4.500 plus 531 per job, and the actual mobile lab operating expenses for February were $8.060. The company expected to work 120 Jobs in February, but actually worked 124 Jobs. Required Prepare a flexible budget performance report showing AirQual Tost Corporation's rovenue and spending varlances and actrivity varlances for February. (Undicate the effect of each vartance by selecting F for favorable, "U for unfavorable, and "None for no effect (.e, zero variance). Input all amounts as positive values. For the Month Ended February 28 Revenue S 30 640Explanation / Answer
Flexible Static Fixed Variable budget budget component component no of jobs 124 120 Revenue 277 34348 33240 Technicial wages 8,200 8,200 8,200 mobile lab operating expense 4,500 31 8344 8220 office expense 2,500 2 2748 2740 advertising expense 1,570 1,570 1,570 insurance 2,900 2,900 2,900 miscellaneous expense 960 2 1208 1200 total expense 20630 35 24,970 24,830 Flexible budget = fixed component + 150 jobs *variable component Static budget = Fixed component + 140 jobs *variable component Flexible budget performance report Actual Revenue & spending Flexible Activity variance Static budget budget variance budget no of jobs 124 124 120 Revenue 30,490 3,858 U 34348 1108 F 33240 less:Exoenses Technicial wages 8,050 50 F 8,200 0 N 8,200 mobile lab operating expense 8,060 284 F 8344 124 U 8220 office expense 2,590 346 F 2748 8 U 2740 advertising expense 1,640 70 U 1,570 0 N 1,570 insurance 2,900 0 N 2,900 0 N 2,900 miscellaneous expense 505 703 F 1,208 8 U 1,200 total expense 23,745 1,225 F 24,970 140 U 24,830 net operating income 6,745 2,633 U 9,378 968 F 8,410