Ruozzo Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for July. Variable Element per Fixed Element Customer Actual Total per Month Served for July Revenue $ 4,500 $ 900 $ 500 $ 100,000 $ 63,300 $ 11,500 $ 37,900 Employee salaries and wages Travel expenses $ 43,100 Other expenses $ 36,900 When the company prepared its planning budget at the beginning of July, it assumed that 27 customers would have been served. However, 22 customers were actually N served during July. The activity variance for net operating income for July would have been closest to:

Ruozzo Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for July. Variable Element per Fixed Element Customer Actual Total per Month Served for July Revenue $ 4,500 $ 900 $ 500 $ 100,000 $ 63,300 $ 11,500 $ 37,900 Employee salaries and wages Travel expenses $ 43,100 Other expenses $ 36,900 When the company prepared its planning budget at the beginning of July, it assumed that 27 customers would have been served. However, 22 customers were actually N served during July. The activity variance for net operating income for July would have been closest to:

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter23: Flexible Budgeting (flexbud)

Section: Chapter Questions

Problem 1R

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