Perla Kennel uses tenant-days as its measure of activity; an
animal housed in the kennel for one day is counted as one
tenant-day. During March, the kennel budgeted for 2,230
tenant-days, but its actual level of activity was 2,190
tenant-days. The kennel has provided the following data concerning
the formulas used in its budgeting and its actual results for
March:
Data used in budgeting:
Fixed element per month | Variable element per tenant-day | |||||
Revenue | − | $ | 34.10 | |||
Wages and salaries | $ | 3,330 | $ | 7.60 | ||
Food and supplies | 1,050 | 8.80 | ||||
Facility expenses | 9,100 | 5.40 | ||||
Administrative expenses | 10,850 | 0.50 | ||||
Total expenses | $ | 24,330 | $ | 22.30 | ||
Actual results for March:
Revenue | $ | 74,149 | |
Wages and salaries | $ | 19,799 | |
Food and supplies | $ | 20,817 | |
Facility expenses | $ | 20,041 | |
Administrative expenses | $ | 11,980 | |
The revenue variance for March would be closest to:
Ans. | Revenue variance = Actual revenue - Flexible budgeted revenue | ||
$74,149 - $74,679 | |||
-530 | |||
or 530 unfavorable | |||
*Calculation of flexible budgeted revenue: | |||
Revenue = Actual level of activity * Revenue per activity | |||
2,190 * $34.10 | |||
$74,679 | |||
*Flexible budget is prepared on the basis of actual activity. | |||
*Decrease in revenue from Flexible budget to Actual = Unfavorable. | |||
*Increase in revenue from Flexible budget to Actual = Favorable. | |||
Perla Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for...
Perla Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 2,280 tenant-days, but its actual level of activity was 2,240 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March: Data used in budgeting: Fixed element per month Variable element per tenant-day Revenue − $ 36.60 Wages and salaries $...
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Dinham Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 3,100 tenant-days, but its actual level of activity was 3,120 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March: Data used in budgeting: Fixed element per month Variable element per tenant-day Revenue - $ 34.00 Wages and salaries $...
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Dinham Kennel uses tenant-days as its measure of activity, an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 4,600 tenant-days, but its actual level of activity was 4,670 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March: Data used in budgeting: Fixed element per month Revenue Wages and salaries Food and supplies Facility expenses Administrative expenses Total...