Jake\'s Roof Repair has provided the following data concerning its costs Cost pe

Question

Jake's Roof Repair has provided the following data concerning its costs Cost per pair-Hour $15.00 $ 7.40 $0.45 $ 1.80 Fixed Cost per Month Re Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses $20,900 $ 2,790 $ 5,750 $ 4,700 $ 3,840 $0.70 For example, wages and salaries should be $20,900 plus $15.00 per repair-hour. The company expected to work 2,600 repair-hours in May, but actually worked 2,500 repair-hours. The company expects its sales to be $47.00 per repair-hour. Required Compute the company's activity variances for May. (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.) Jake's Roof Repair Activity Variances For the Month Ended May 31 Flexible Budget Planning Budget Activity Variances Repair-hours Revenue Expenses Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses Total expense Net operating income

Explanation / Answer

ACTIVITY VARIANCE :

Planning budget Flexible budget Activity variance Repairs hours 2600 2500 Revenue 122200 117500 4700 U Expenses Wages and salaries 59900 58400 1500 F Parts supplies 19240 18500 740 F Equipment depreciation 3960 3915 45 F Truck operating expenses 10430 10250 180 F Rent 4700 4700 None Administrative expenses 5660 5590 70F Total expenses 103890 101355 2535 F Net operating income 18310 16145 2165 U

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