Mcdougald 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 March. Variable Element Fixed Element per Month per Customer Served Actual Total for March Revenue 2$ 6,500 $ 169,700 Employee salaries and wages 2$ 58,400 2$ 1,000 $83,200 Travel expenses $ 700 $18,600 Other expenses $ 41,500 $ 41,900 When the company prepared its planning budget at the beginning of March, it assumed that 21 customers would have been served. However, 26 customers were actually served during March.
Mcdougald 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 March. Variable Element Fixed Element per Month per Customer Served Actual Total for March Revenue 2$ 6,500 $ 169,700 Employee salaries and wages 2$ 58,400 2$ 1,000 $83,200 Travel expenses $ 700 $18,600 Other expenses $ 41,500 $ 41,900 When the company prepared its planning budget at the beginning of March, it assumed that 21 customers would have been served. However, 26 customers were actually served during March.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Transcribed Image Text:Mcdougald 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 March.
Variable Element
per Customer
Served
Fixed Element per
Actual Total
Month
for March
Revenue
$
6,500
$ 169,700
Employee salaries and wages
2$
58,400
$
1,000
$83,200
Travel expenses
$
700
$ 18,600
Other expenses
2$
41,500
$ 41,900
When the company prepared its planning budget at the beginning of March, it assumed that 21 customers would have been served.
However, 26 customers were actually served during March.
The spending variance for "Employee salaries and wages" for March would have been closest to:
O A. $1,200 U
O B. $3,800 U
O C.$3,800 F
O D. $1,200 F
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education