Varcoe Corporation bases its budgets on the activity measure customers served. During September, the company planned to serve 37,500 customers, but actually served 32,500 customers. Revenue is $3.95 per customer served. Wages and salaries are $35,600 per month plus $1.35 per customer served. Supplies are $0.65 per customer served. Insurance is $9,800 per month. Miscellaneous expenses are $7,900 per month plus $0.35 per customer served. Required: Prepare a report showing the company's activity variances for September. Indicate in each case whether the variance is favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values and enter any losses with a minus sign. Varcoe Corporation Activity Variances For the Month Ended September 30 Customers served Revenue Expenses: Wages and salaries Supplies Insurance Miscellaneous expense Total expense Net operating income (loss) Flexible Budget Planning Budget Activity Variances 32,500 37,500 U U
Varcoe Corporation bases its budgets on the activity measure customers served. During September, the company planned to serve 37,500 customers, but actually served 32,500 customers. Revenue is $3.95 per customer served. Wages and salaries are $35,600 per month plus $1.35 per customer served. Supplies are $0.65 per customer served. Insurance is $9,800 per month. Miscellaneous expenses are $7,900 per month plus $0.35 per customer served. Required: Prepare a report showing the company's activity variances for September. Indicate in each case whether the variance is favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values and enter any losses with a minus sign. Varcoe Corporation Activity Variances For the Month Ended September 30 Customers served Revenue Expenses: Wages and salaries Supplies Insurance Miscellaneous expense Total expense Net operating income (loss) Flexible Budget Planning Budget Activity Variances 32,500 37,500 U U
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
None
Transcribed Image Text:Varcoe Corporation bases its budgets on the activity measure customers served. During September, the company planned to serve
37,500 customers, but actually served 32,500 customers. Revenue is $3.95 per customer served. Wages and salaries are $35,600 per
month plus $1.35 per customer served. Supplies are $0.65 per customer served. Insurance is $9,800 per month. Miscellaneous
expenses are $7,900 per month plus $0.35 per customer served.
Required:
Prepare a report showing the company's activity variances for September. Indicate in each case whether the variance is favorable (F)
or unfavorable (U).
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values and enter any losses with a minus sign.
Varcoe Corporation
Activity Variances
For the Month Ended September 30
Customers served
Revenue
Expenses:
Wages and salaries
Supplies
Insurance
Miscellaneous expense
Total expense
Net operating income (loss)
Flexible
Budget
Planning
Budget
Activity Variances
32,500
37,500
U
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 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education