Question

Boyne University offers an extensive continuing education program in marıy cities throughout the state. For the convenience of n faculty and administrative staff and to save costs, the university operates á motor pool. The motor pools monthly planning budget based on operating 20 vehicles, however, for the month of March the university purchased one additional vehicle. The motor podl fumishes gasoline, oil, and other supplies for its automobiles A mechanic does routine maintenance and minor repairs Major repairs are performed at a nearby commercial garage The following cost control report shows actual operating costs for March of the current year compared to the planning budget for March Bayne University Notor Poo For the Month Endad Harch 31 narcbPlanning ActurludgetBudget 7,99 4,0e miles Gaseline 011, minor repairs, pares Outside repairs Insurance Salarles and benefLts Vehicle dapreciation Tatal s 14,40 s 13,473 (9 8,320 1,285 1,020 (185) ,830 544915220 38,885$37.027 5779 The planning budget was based on the fallowing assumptions

a $0.27 per mile for gasoline b $0.16 per mile for ol, minoe repairs, and parts c. $51 per automobile per month for outside repairs d $86 per automobile e $8,510 per month for salaries and benefes. t $211 per automobile per month for depreciation lor The supervisor of the motor pool is untiaooy with the iepart, aiming it pains an untair oicture of the mator poots pesformance Required: 1 Calculate the spending variances for March (Round per mile answers to 2 decimal piaces Indicate the effect of esch variance for fevorable, U for unfavorable, and None for no effect 0.e., sero veriance). Input all amounts ss poaltive veeeces by selecting volues.) Boyne University Motor Pool Spending Varlances For the Month Ended Warch 31


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Cost Units March Actual March Flexible Budget Spending Variance 2 Miles 3 AutoS 4 Gasoline 5 57,000 21 14,400 8,320 1,205 1,840 8,610 4,431 57,000 21 15,390 9,120 1,071 1,806 8,610 4,431 0.27/mile 0.16/mile Oil,Minor Repairs 6 Outside Repairs 7 Insurance 8 Salaries 9 Depreciation 990 F 800 F 134 U 34U 0 0 51.00/month/auto 86.00/month/auto 8610.00|/month 211.00|/month/auto

Salaries were fixed

Gasoline and oil repairs are multiplied by 57,000 miles to find flexible budget

Outside repairs, Insurance, and depreciation multiplied by 21 to find the flexible budget.

Spending is Flexible minus actual.

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