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Vadim26 [7]
3 years ago
8

Petrus Framing's cost formula for its supplies cost is $1,710 per month plus $9 per frame. For the month of March, the company p

lanned for activity of 611 frames, but the actual level of activity was 614 frames. The actual supplies cost for the month was $7,490. The activity variance for supplies cost in March would be closest to:
Business
2 answers:
Luden [163]3 years ago
7 0

Answer:

The correct answer is  $27 U'.

Explanation:

The activity variance for supplies cost in March is calculated below:

Activity variance = Planning Budget - Flexible budget

Activity variance = (1,710 + (9 x 611)) — (1,710 + (8 x 614))  

Activity variance = $7,209 — $7,236

Activity variance = $27U  

The flexible budget is higher than the planning budget.  

Thus, the variance is unfavorable (U).

Hence, the correct answer is  $27 U'.

kirill [66]3 years ago
3 0

Answer: %27 U

Explanation:

Planing budget= 1710+9x611=7209

Flexible budget = 1710+9x614=7236

Activity variance = 7236-7209=$27 which is unfavorable

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