Via Gelato, a popular neighborhood gelato shop, provided the following cost formulas and actual results for the month of June: Fixed Element per Month Variable Element per Actual Total Liter for June Revenue $ 22.00 $ 130,540 Raw materials Wages $ 5.65 $ 35,930 $ 6,600 $ 2.40 $ 21,000 Utilities $ 2,630 $ 1.20 $ 10,500 Rent $ 3,600 Insurance $ 2.350 Miscellaneous $ 750 1.35 $ 3,600 $2,350 $ 8,590 While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $6,600 plus $2.40 per liter of gelato sold and the actual wages for June were $21,000. Via Gelato expected to sell 6,000 liters in June but actually sold 6,200 liters. Required: Calculate Via Gelato's revenue and spending variances for June. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect
Via Gelato, a popular neighborhood gelato shop, provided the following cost formulas and actual results for the month of June: Fixed Element per Month Variable Element per Actual Total Liter for June Revenue $ 22.00 $ 130,540 Raw materials Wages $ 5.65 $ 35,930 $ 6,600 $ 2.40 $ 21,000 Utilities $ 2,630 $ 1.20 $ 10,500 Rent $ 3,600 Insurance $ 2.350 Miscellaneous $ 750 1.35 $ 3,600 $2,350 $ 8,590 While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $6,600 plus $2.40 per liter of gelato sold and the actual wages for June were $21,000. Via Gelato expected to sell 6,000 liters in June but actually sold 6,200 liters. Required: Calculate Via Gelato's revenue and spending variances for June. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Give me step by step solution and explanation.vi
Transcribed Image Text:Via Gelato, a popular neighborhood gelato shop, provided the following cost formulas and actual results for the month of
June:
Fixed
Element per
Month
Variable
Element per
Actual Total
Liter
for June
Revenue
$ 22.00
$ 130,540
Raw materials
Wages
$ 5.65
$ 35,930
$ 6,600
$ 2.40
$ 21,000
Utilities
$ 2,630
$ 1.20
$ 10,500
Rent
$ 3,600
Insurance
$ 2.350
Miscellaneous
$ 750
1.35
$ 3,600
$2,350
$ 8,590
While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For
example, wages should be $6,600 plus $2.40 per liter of gelato sold and the actual wages for June were $21,000. Via
Gelato expected to sell 6,000 liters in June but actually sold 6,200 liters.
Required:
Calculate Via Gelato's revenue and spending variances for June.
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect
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