Via Gelato is a popular neighborhood gelato shop. The company has provided the f

Question

Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the month of June: for Revenue Raw materials Hages Utilities Rent Insurance Miscellaneous 6,288 s 2,230 s 3,280 s 1,958 s 718 18.00 5.25 5 2.00 s e.88 110,538 $ 33,738 S18,98e S 7,556 S 3,280 $ 1,958 6,670 8.95 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 $6,200 plus $2.00 per liter of gelato sold and the actual wages for June were $18,900. Via Gelato expected to sell 6,200 liters in June, but actually sold 6,400 liters Required Calculate Via Gelato revenue and spending variances for June. (Indicate the effect of each variance by selecting"p for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Via Gelato Revenue and Spending Variances For the Month Ended June 30 Revenue Expenses Raw matenals Wages Utilities Rent Insurance Total expense Net operating income

Explanation / Answer

Budgeted Actual Spending variance Revenue 115200 110530 4670 Unfavorable Expenses Raw material 33600 33730 130 Unfavorable Wages 19000 18900 100 Favorable Utilities 7350 7550 200 Unfavorabble Rent 3200 3200 0 Insurance 1950 1950 0 Miscelleneous 6790 6670 120 Fvaorable Total expense 71890 72000 110 Unfavorable Net operating income 43310 38530 4890 Unfavorable

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