Via Gelato is a popular neighborhood gelato shop. The company has provided the f
ID: 2479397 • Letter: V
Question
Via Gelato is a popular neighborhood gelato shop. The company has provided the following data concerning its operations:
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 $7,600 plus $3.40 per liter of gelato sold and the actual wages for June were $28,100. Via Gelato expected to sell 6,000 liters in June, but actually sold 6,200 liters.
Complete the report showing Via Gelato revenue and spending variances for June. (Indicate the effect of each variance by selecting "F" 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 materials
Wages
Utilities
Rent
Insurance
Miscellaneous
Total expense
Net operating income
Via Gelato is a popular neighborhood gelato shop. The company has provided the following data concerning its operations:
FixedElement
per Month Variable
Element
per Liter Actual
Total for
June Revenue $ 32.00 $ 192,540 Raw materials $ 6.65 $ 41,930 Wages $ 7,600 $ 3.40 $ 28,100 Utilities $ 3,630 $ 2.20 $ 17,500 Rent $ 4,600 $ 4,600 Insurance $ 3,350 $ 3,350 Miscellaneous $ 850 $ 2.35 $ 15,190
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 $7,600 plus $3.40 per liter of gelato sold and the actual wages for June were $28,100. Via Gelato expected to sell 6,000 liters in June, but actually sold 6,200 liters.
Required:Complete the report showing Via Gelato revenue and spending variances for June. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Via Gelato
Revenue and Spending Variances
For the Month Ended June 30
Revenue
Expenses:
Raw materials
Wages
Utilities
Rent
Insurance
Miscellaneous
Total expense
Net operating income
Explanation / Answer
VOA GALATO REVENUE AND SPENDING VARIANCES FOR THE MONTH OF JUNE 30
_____________________________________________________________________________________
VARIANCE ($)
Revenue 540 (F)
Expenses:
Raw Materials 700 (U)
Wages 580 (F)
Utilities 230 (U)
Rent 0 None
Insurance 0 None
Miscellaneous 230 (F)
Total expenses 120 (U)
Net operating Income 420 (F)
WORKING NOTES:
CALCULATION OF VARIANCES FOR THE MONTH OF JUNE 30
_________________________________________________________________________________________
PARTICUARS BUDGETED ACTUAL VARIANCE STATUS
Raw Materials 6,200 litres x 6.65 = 41,230 41,930 700 U
Wages 7,600 + 6,200 x 3.40= 28,680 28,100 580 F
Utilities 3,630+6200 x 2.20 = 17,270 17,500 230 U
Rent 4,600 4,600 0 None
Insuracne 3,350 3,350 0 None
Miscellaneous 850 + 6,200 x 2.35 = 15,420 15,190 230 F
Total Expenses 110,550 110,670 120 U
Net operating Income (Revenue - Total exp) 81,450 81,870 420 F
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.