A laundry service budgeted for 800 washes, but its actual level of activity was 1,000 washes. The company provided the following budget and actual results. Assume that detergent costs are variable costs and machine rental is a fixed cost. • Budgeted cost for detergent: $1,200 • Actual cost for detergent: $1,500 What is the activity variance for detergent costs? A. $300 U B. $250 F C. $250 U D. $0

A laundry service budgeted for 800 washes, but its actual level of activity was 1,000 washes. The company provided the following budget and actual results. Assume that detergent costs are variable costs and machine rental is a fixed cost. • Budgeted cost for detergent: $1,200 • Actual cost for detergent: $1,500 What is the activity variance for detergent costs? A. $300 U B. $250 F C. $250 U D. $0

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 20BEA: Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, Construct a Cost Formula, and...

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Given the following information, calculate the purchasing department's efficiency variance. Standard number of transaction per day Standard labor cost per day Actual number of days for processing transactions Actual number of transactions processed Actual labor cost per day Multiple choice question. $2,400 favorable $4,400 favorable $4,400 unfavorable $2,400 unfavorable 20 $200 120 1,960 $180
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The following data have been provided by Your Corporation: Standard MH per motor 8.6 MH Standard $ for power $1.40 per MH Budgeted MH (total) 62,000 MH Actual MH (total) 62,140 MH Actual power cost $84,989 What is the variable overhead spending variance for power?
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4. Use the following terms in preparing the budget: Insurance Maintenance Utilities Depreciation Expense Sales Commissions Depreciation Indirect Material Maintenance Salaries Indirect Labor Supervisory Salaries Sales Salaries Insurance Expense Spree Party Lights overhead expenses are: Indirect material, pounds per unit 0.25 Indirect material, cost per pound $ 2 Indirect labor hours 1 Indirect labor rate per hour $16.50 Variable maintenance per unit $0.75 Variable utilities per unit $0.20 Supervisor salaries $10,000 Maintenance salaries $9,000 Insurance $3,000 Depreciation $1,500 PLEASE NOTE: All dollar amounts are rounded to whole dollars and shown…
Q.Use the direct material usage budget to find the budgeted allocation rate for materials-handling costs.
LO.5 (Flexible budget) Tom's Shoe Repair provides a variety of shoe repair services. Analysis of monthly costs revealed the following cost formulas when direct labor hours are used as the basis of cost determination:Supplies: y= $0 + S4.00XProduction supervision and direct labor: y $500+ $7.00XUtilities: y= $350 + $5.40XRent: y= $450+ $0.00XAdvertising: y = $75 + $0.00OXa. Prepare a flexible budget at 250, 300, 350, and 400 direct labor hours.b. Calculate a total cost per direct labor hour at each level of activity. c. Tom's emplovees usually work 350 direct labor hours per month. The average shoe repair requires 1.25 labor hours to complete. Tom wants to earn a 40 percent margin on his cost. What should be the average charge per customer, rounded to the nearest dollar to achieve Tom's profit objective?
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