Question

Dermody Snow Removal's cost formula for its vehicle operating cost is $3,030 per month plus $333 per snow-day. For the month of December, the company planned for activity of 15 snow-days, but the actual level of activity was 17 snow-days. The actual vehicle operating cost for the month was $8,300. The spending variance for vehicle operating cost in December would be closest to:

Answer 1

Answer:

391 F

Explanation:

Calculation to determine what The spending variance for vehicle operating cost in December would be closest to

Using this formula

Spending variance for vehicle operating cost = Flexible budget-Actual

Let plug in the formula

Spending variance for vehicle operating cost= (333*17+3,030)-8300

Spending variance for vehicle operating cost=(5,661+3,030)-8,300

Spending variance for vehicle operating cost=8,691-8,300

Spending variance for vehicle operating cost=391 F

Therefore The spending variance for vehicle operating cost in December would be closest to

391 F