Ruozzo 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 July. Variable Element per Fixed Element Customer Actual Total per Month Served for July Revenue $ 4,500 $ 900 $ 500 $ 100,000 $ 63,300 $ 11,500 $ 37,900 Employee salaries and wages Travel expenses $ 43,100 Other expenses $ 36,900 When the company prepared its planning budget at the beginning of July, it assumed that 27 customers would have been served. However, 22 customers were actually N served during July. The activity variance for net operating income for July would have been closest to:

Ruozzo 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 July. Variable Element per Fixed Element Customer Actual Total per Month Served for July Revenue $ 4,500 $ 900 $ 500 $ 100,000 $ 63,300 $ 11,500 $ 37,900 Employee salaries and wages Travel expenses $ 43,100 Other expenses $ 36,900 When the company prepared its planning budget at the beginning of July, it assumed that 27 customers would have been served. However, 22 customers were actually N served during July. The activity variance for net operating income for July would have been closest to:

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 8P: Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of...

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