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EXERCISE 9-17 Flexible Budget Performance Report LO9-1, LO9-2, LO9-3, LO9-4
AirQual Test Corporation provides on-site air quality testing services. The company has provided the following cost formulas and actual results for the month of February:
Fixed Component per Month |
Variable Component per Job | Actual Total for February |
|
Revenue | $360 | $18,950 | |
Technician wages | $6,400 |
$6,450 | |
Mobile lab operating expenses | $2,900 |
$35 | $4,530 |
Office expenses | $2,600 |
$2 | $3,050 |
Advertising expenses | $970 |
$995 | |
Insurance | $1,680 |
$1,680 | |
Miscellaneous expenses | $500 |
$3 | $465 |
The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $2,900 plus $35 per job. and the actual mobile lab operating expenses for February' w’ere $4,530. The company expected to work 50 jobs in February', but actually worked 52 jobs.
Required:
Using Exhibit 9-8 as your guide, prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activitv variances for February.
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MANAGERIAL ACCOUNTING
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