AirQual Test Corporation provides on-site alr quality testing services The compa

Question

AirQual Test Corporation provides on-site alr quality testing services The company has pr actual results for the month of February ovided the following cost formuus and Revenue Technician wages $,200 s 2.289 $ 2,860 $ 34 office expenses S 1,650 s 2,860 S 375 948 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4 800 plus $34 per job, and the actual mobile lab operating expenses for February were S9060. The company expected to work 130 jobs in February, but actually worked 138 jobs Prepare a flexible budget performance report showing AirQual Test Corporation's revenue and spending variances and activity variances for February. (Indicete the effect of each variance by selecting F for favorable. "U for unfavorable, and 'None for no effect (i.e., zero variance). Input oll omounts as positive values.) Flexible Budget e Report 28 Jobs 138 Revenue S 33.130 Expenses 8.050 9.060 2.570 1.650 2.860 375 24.565 S 8.566 Mobile lab operating Advertising expenses Total expense Net operating income

Explanation / Answer

AIRQUAL TEST CORPORATION Flexible Budget Performance Report for the month ended February 28 Actual Results Flexible budget Vaiance Flexible Budget Sales Volume Variance Planning Budget 1 2 3 4 5 (1-3) (3-5) Jobs 138 138 130 Revenue 33130 4958 U 38088 2208 F 35880 Expenses:    Technical Wages 8050 150 F 8200 0 8200    Mobile lab operating expenses 9060 432 F 9492 272 U 9220    Office Expenses 2570 182 F 2752 32 U 2720    Advertining Expenses 1650 70 U 1580 0 1580    Insurance 2860 0 2860 0 2860    Miscellaneous Expenses 375 703 F 1078 8 U 1070 Total Expenses 24565 1537 F 25962 312 U 25650 Net Operating Income 8565 3421 U 12126 1896 F 10230

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