Albers Corporation manufactures and sells a single product. The company uses uni

Question

Albers Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,600 units, but its actual level of activity was 7,570 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April:

Burau Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 5,500 units, but its actual level of activity was 5,510 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January:

8. The activity variance for direct labor in April would be closest to: $162 U $978 U $978 F $162 F
9. The activity variance for selling and administrative expenses in April would be closest to: $15 F $645 U $645 F $15 U
10. The activity variance for net operating income in April would be closest to: $13,998 U $372 F $13,998 F $372 U

Burau Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 5,500 units, but its actual level of activity was 5,510 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January:

Data used in budgeting:



Actual results for January:



12. The activity variance for selling and administrative expenses in January would be closest to: $4 U $4 F $834 U $834 F
13. The spending variance for direct materials in January would be closest to: $1,436 F $1,560 U $1,560 F $1,436 U

Explanation / Answer

8.The activity variance for direct labor in April would be closest to:

DIr Lab Var = DL Rate(Actual Units-Unit Budegetd)

= 5.40*(7570-7600) = -$162 = $162U

9.The activity variance for selling and administrative expenses in April would be closest to:

S&A Exp Var = S&A Var Rate(Actual Units-Unit Budegetd)

= 0.5*(7570-7600) = -$15 = $15U

10.The activity variance for net operating income in April would be closest to:

Net Op Inc Var = COnt pu*(Actual Units-Unit Budegetd)

= (35.20-22.80)*(7570-7600) = -$372 = $372U

12.The activity variance for selling and administrative expenses in January would be closest to:

S&A Var = Budgeted S&A - Actual S&A

= (5510*0.40+21300) - 24334 = -$834 = $834U

13.The spending variance for direct materials in January would be closest to:

Dir Mat Var = Budgeted DM - Actial DM

= 6.50*5510 - 66764 = $1560 = $1560F

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