AirQual Test Corporation provides on-site air quality testing services. The company provided the following cost formulas and actual results for the month of February: Fixed Variable Component Component per Actual Total per Month Revenue Job $ 276 for February $ 27,610 Technician wages $ 8,500 $ 8,350 Mobile lab operating expenses $ 4,600 $ 31 $ 7,850 Office expenses $ 2,700 $ 2 $ 2,770 Advertising expenses $ 1,550 $ 1,620 Insurance Miscellaneous expenses $2,870 $ 970 $ 1 $ 2,870 $ 385 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,600 plus $31 per job, and the actual mobile lab operating expenses for February were $7,850. The company expected to work 110 jobs in February but actually worked 118 jobs. Required: Prepare a flexible budget performance report for February. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.
AirQual Test Corporation provides on-site air quality testing services. The company provided the following cost formulas and actual results for the month of February: Fixed Variable Component Component per Actual Total per Month Revenue Job $ 276 for February $ 27,610 Technician wages $ 8,500 $ 8,350 Mobile lab operating expenses $ 4,600 $ 31 $ 7,850 Office expenses $ 2,700 $ 2 $ 2,770 Advertising expenses $ 1,550 $ 1,620 Insurance Miscellaneous expenses $2,870 $ 970 $ 1 $ 2,870 $ 385 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,600 plus $31 per job, and the actual mobile lab operating expenses for February were $7,850. The company expected to work 110 jobs in February but actually worked 118 jobs. Required: Prepare a flexible budget performance report for February. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter9: Standard Costing: A Functional-based Control Approach
Section: Chapter Questions
Problem 30P: Algers Company produces dry fertilizer. At the beginning of the year, Algers had the following...
Related questions
Concept explainers
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Topic Video
Question
Manji
Transcribed Image Text:AirQual Test Corporation provides on-site air quality testing services. The company provided the following cost formulas and actual
results for the month of February:
Fixed
Variable
Component Component per Actual Total
per Month
Revenue
Job
$ 276
for February
$ 27,610
Technician wages
$ 8,500
$ 8,350
Mobile lab operating expenses
$ 4,600
$ 31
$ 7,850
Office expenses
$ 2,700
$ 2
$ 2,770
Advertising expenses
$ 1,550
$ 1,620
Insurance
$ 2,870
Miscellaneous expenses
$ 970
$ 1
$ 2,870
$ 385
The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,600 plus
$31 per job, and the actual mobile lab operating expenses for February were $7,850. The company expected to work 110 jobs in
February but actually worked 118 jobs.
Required:
Prepare a flexible budget performance report for February.
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,