value: 10.00 points Cicchetti Corporation uses customers served as its measure o

Question

value: 10.00 points Cicchetti Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of December: Cicchetti Corporation Comparison of Actual Results to Planning Budget For the Month Ended December 31 Actual Planning Results Budget Variances Customers served Revenue (3.50q) 37,000 36,000 $ 130,100 $126,000 $ 4,100 F Expenses Wages and salaries ($23,600 +$1.26q) 70,220 68,960 1,260 U Supplies ($0.66q) Insurance ($5,500) Miscellaneous expense ($4,500$.35q) 14,700 17,100 2,400 F 21,360 23,760 2,400 F 5,500 5,500 Total expense 111,780 115,320 3,540 F Net operating income $ 18,320 $ 10,680 $ 7,640 F Required 1.Prepare a report showing the company's revenue and spending variances for December. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) CICCHETTI CORPORATION Revenue and Spending Variances For the Month Ended December 31 Actual Results Revenue and Spending Variances Flexible Budget Customers served 37,000 Revenue $ 130,100 Expenses: Wages and salaries Supplies Insurance Miscellaneous expense 70,220 21,360 5,500 4,700 111,780 $ 18,320 Total expense Net operating income

Explanation / Answer

Actual Revenue and spending variances Flexible budget Consumers served 37000 37000 Revenue 130100 600 F 129500 Expenses: Wages and salaries 70220 0 None 70220 Supplies 21360 3060 F 24420 Insurance 5500 0 None 5500 Miscellaneous expenses 14700 2750 F 17450 Total expense 111780 5810 F 117590 Net operating income 18320 6410 F 11910

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