Arrasmith Corporation uses customers served as its measure of activity. During F

Question

Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 36,700 customers, but actually served 27,300 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:

Revenue: $5.20q

Wages and salaries: $34,900 + $1.61q

Supplies: $1.01q

Insurance: $12,100

Miscellaneous expenses: $8,100 + $0.47q

The company reported the following actual results for February:

Required:

Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). (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.)

Revenue $ 153,800 Wages and salaries $ 69,700 Supplies $ 16,100 Insurance $ 12,100 Miscellaneous expense $ 26,200

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up   Statementshowing Computations Paticulars Flexible   Actual Variance F or U Revenue:          141,960.00         153,800.00         (11,840.00) U Wages and salaries            78,853.00            69,700.00              9,153.00 U Supplies            27,573.00            16,100.00            11,473.00 U Insurance              12,100.00            12,100.00                           -   None Miscellaneous expense            20,931.00            26,200.00            (5,269.00) F

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