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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 Revenue Actual Total for February $30,610 $7,958 Fixed Component per Month Variable Component per Job $278 Technician wages $8,100 Mobile lab operating expenses $4,700 $ Office expenses $2,600 32 $ 2 $ 2,698 Advertising expenses $1,610 $ 1,680 Insurance $2,850 $ Miscellaneous expenses $ 940 $ 2 2,850 $ 485 $ 8,380 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,700 plus $32 per job, and the actual mobile lab operating expenses for February were $8,380. The company expected to work 120 jobs in February, but actually worked 128 jobs. Required: Prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activity variances for February (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (ie., zero variance). Input all amounts as positive values.) AirQual Test Corporation Flexible Budget Performance Report Actual Results 128 For the Month Ended February 28 Revenue and Spending Variances Flexible Planning Budget Activity Variances Budget Jobs 128 120 Revenue $ 30,610 $ $ 30.610 $ 1,913 F $ 28.097 Expenses Technician wages 7,950 75,734 F 43.084 Nane 41.460 Mobile lab operating 8,300 416 F 8.796 256 U 8,540 expenses Office expenses 2,000 1,300 1,324 64U 1,260 Advertising expenses 1,680 688 F 2.368 None 2,320 Insurance 2.850 None 2.850 None 2.850 Miscellaneous expenses 485 711F 1.196 16 U 1,180 Total expense 24,036 36,183 60,218 2,600 57.610 Net operating income $6,575 $ 36,283 $ (29,708) 205 (28.913)

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 Revenue Actual Total for February $30,610 $7,958 Fixed Component per Month Variable Component per Job $278 Technician wages $8,100 Mobile lab operating expenses $4,700 $ Office expenses $2,600 32 $ 2 $ 2,698 Advertising expenses $1,610 $ 1,680 Insurance $2,850 $ Miscellaneous expenses $ 940 $ 2 2,850 $ 485 $ 8,380 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,700 plus $32 per job, and the actual mobile lab operating expenses for February were $8,380. The company expected to work 120 jobs in February, but actually worked 128 jobs. Required: Prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activity variances for February (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (ie., zero variance). Input all amounts as positive values.) AirQual Test Corporation Flexible Budget Performance Report Actual Results 128 For the Month Ended February 28 Revenue and Spending Variances Flexible Planning Budget Activity Variances Budget Jobs 128 120 Revenue $ 30,610 $ $ 30.610 $ 1,913 F $ 28.097 Expenses Technician wages 7,950 75,734 F 43.084 Nane 41.460 Mobile lab operating 8,300 416 F 8.796 256 U 8,540 expenses Office expenses 2,000 1,300 1,324 64U 1,260 Advertising expenses 1,680 688 F 2.368 None 2,320 Insurance 2.850 None 2.850 None 2.850 Miscellaneous expenses 485 711F 1.196 16 U 1,180 Total expense 24,036 36,183 60,218 2,600 57.610 Net operating income $6,575 $ 36,283 $ (29,708) 205 (28.913)

Principles of Cost Accounting
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter5: Process Cost Accounting—general Procedures
Section: Chapter Questions
Problem 2P: Dublin Brewing Co. uses the process cost system. The following data, taken from the organizations...
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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 Revenue Actual Total for February $30,610 $7,958 Fixed Component per Month Variable Component per Job $278 Technician wages $8,100 Mobile lab operating expenses $4,700 $ Office expenses $2,600 32 $ 2 $ 2,698 Advertising expenses $1,610 $ 1,680 Insurance $2,850 $ Miscellaneous expenses $ 940 $ 2 2,850 $ 485 $ 8,380 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,700 plus $32 per job, and the actual mobile lab operating expenses for February were $8,380. The company expected to work 120 jobs in February, but actually worked 128 jobs. Required: Prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activity variances for February (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (ie., zero variance). Input all amounts as positive values.) AirQual Test Corporation Flexible Budget Performance Report Actual Results 128 For the Month Ended February 28 Revenue and Spending Variances Flexible Planning Budget Activity Variances Budget Jobs 128 120 Revenue $ 30,610 $ $ 30.610 $ 1,913 F $ 28.097 Expenses Technician wages 7,950 75,734 F 43.084 Nane 41.460 Mobile lab operating 8,300 416 F 8.796 256 U 8,540 expenses Office expenses 2,000 1,300 1,324 64U 1,260 Advertising expenses 1,680 688 F 2.368 None 2,320 Insurance 2.850 None 2.850 None 2.850 Miscellaneous expenses 485 711F 1.196 16 U 1,180 Total expense 24,036 36,183 60,218 2,600 57.610 Net operating income $6,575 $ 36,283 $ (29,708) 205 (28.913)
Transcribed Image Text: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 Revenue Actual Total for February $30,610 $7,958 Fixed Component per Month Variable Component per Job $278 Technician wages $8,100 Mobile lab operating expenses $4,700 $ Office expenses $2,600 32 $ 2 $ 2,698 Advertising expenses $1,610 $ 1,680 Insurance $2,850 $ Miscellaneous expenses $ 940 $ 2 2,850 $ 485 $ 8,380 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,700 plus $32 per job, and the actual mobile lab operating expenses for February were $8,380. The company expected to work 120 jobs in February, but actually worked 128 jobs. Required: Prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activity variances for February (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (ie., zero variance). Input all amounts as positive values.) AirQual Test Corporation Flexible Budget Performance Report Actual Results 128 For the Month Ended February 28 Revenue and Spending Variances Flexible Planning Budget Activity Variances Budget Jobs 128 120 Revenue $ 30,610 $ $ 30.610 $ 1,913 F $ 28.097 Expenses Technician wages 7,950 75,734 F 43.084 Nane 41.460 Mobile lab operating 8,300 416 F 8.796 256 U 8,540 expenses Office expenses 2,000 1,300 1,324 64U 1,260 Advertising expenses 1,680 688 F 2.368 None 2,320 Insurance 2.850 None 2.850 None 2.850 Miscellaneous expenses 485 711F 1.196 16 U 1,180 Total expense 24,036 36,183 60,218 2,600 57.610 Net operating income $6,575 $ 36,283 $ (29,708) 205 (28.913)
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