Wadhams Snow Removal's cost formula for its vehicle operating cost is $1,900 per month plus $430 per snow-day. For the month of December, the company planned for activity of 16 snow-days, but the actual level of activity was 21 snow-days. The actual vehicle operating cost for the month was $11,470. The vehicle operating cost in the planning budget for December would be closest to:

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A: Definition:   Material budget: Material purchase budget determines the measure of direct materials…

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A: Total cost = Fixed costs + P0.75 x no. of machine hour = P12,000 + P0.75 per machine hour

Q: The planning budget for March was based on producing and selling 30,000 units. However, during March…

A: Raw Material Cost = Number of Units x Cost per Unit

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A: Vehicle operating cost in planning budget will be calculated as per planned snow days

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A: Please see the next step for the solution

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A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

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A:

Q: Dermody Snow Removal's cost formula for its vehicle operating cost is $3,080 per month plus $338 per…

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Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.