Problem

Air Assurance Corporation provides on-site air quality testing services.The company has pr...

Air Assurance Corporation provides on-site air quality testing services.The company has provided the following data concerning its operations:

 

Fixed Component per Month

Variable Component per Job

Actual Total for March

Revenue

 

$275

$24,750

Technician wages

$ 8,600

 

$8,450

Mobile lab operating expenses

$ 4,900

$29

$7,960

Office expenses

$ 2,700

$3

$2,850

Advertising expenses

$ 1,580

 

$1,650

Insurance

$ 2,870

 

$2,870

Miscellaneous expenses

$ 960

$2

$465

The company uses the number of jobs as its measure of activity. Forexample, mobile lab operating expenses should be $4,900 plus $29 per job, and the actual mobile lab operating expenses for March were $7,960.

The company expected to work 100 jobs in March, but actually worked 98 jobs.

Required:

Prepare a flexible budget performance report showing Air Assurance Corporation's activity variances and revenue and spending variances for March.

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Solutions For Problems in Chapter 9