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Radda [10]
3 years ago
15

Feemster Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets a

nd performance reports. During October, the company budgeted for 6,030 units, but its actual level of activity was 5,980 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October: Data used in budgeting: Fixed element per month Variable element per unit Revenue - $ 31.20 Direct labor $ 0 $ 6.90 Direct materials 0 9.90 Manufacturing overhead 38,300 2.60 Selling and administrative expenses 25,900 2.10 Total expenses $ 64,200 $ 21.50 Actual results for October: Revenue $ 182,595 Direct labor $ 38,010 Direct materials $ 56,300 Manufacturing overhead $ 52,275 Selling and administrative expenses $ 38,170 The activity variance for selling and administrative expenses in October would be closest to:
Business
1 answer:
damaskus [11]3 years ago
5 0

Answer:

$288 (F)

Explanation:

In order to calculate activity variance we subtract actual results from the flexible budget. Moreover, the flexible budget is determined by taken into account both fixed and variable expense of the activity. This is shown below:

Flexible Budget of Selling and Administrative Expense = 25,900 + (2.1 x 5,980) = $38,458

Variance = 38,170 - 38,458 = $288 (F)

Because the actual expense is less than the flexible budget, the variance is favorable (F).

Note: Variable flexible budget is calculated by multiplying the variable rate with the actual units produced.

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Explanation:

This could be due a number of factors.

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Externality is the effect of a third party on a property right, when all parties cannot come to an agreeable resolution on properties this could lead to inefficient use of land.

Also when the property rights are not put in place its difficult to come to a resolution that satisfies all parties.

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Rhonda has an adjusted basis and an at-risk amount of $7,500 in a passive activity at the beginning of the year. She also has a
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Answer:

c. $9,000

Explanation:

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Answer:

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