Answer:
$1,540
Explanation:
Calculation for the activity variance for cleaning equipment and supplies in September
First step is to calculate for theFlexible budget
Using this formula
Flexible budget =[Cleaning equipment and supplies +(Amount per boat ×Actual level of activity)
Let plug in the formula
Flexible budget =[$2,940 + ($35 × 29)]
Flexible budget =$2,940+$1,105
Flexible budget =$3,955
Second step is to calculate for the Planning budget using this is formula
Planning budget =[Cleaning equipment and supplies +(Amount per boat ×Planned activity ]
Let plug in the formula
Planning budget= [$2,940 + ($35 × 73)]
Planning budget=$2,940+$2,555
Planning budget=$5,495
Now let calculate for the activity variance
Using this formula
Activity variance=Flexible budget-Planning budget
Let plug in the formula
Activity variance=$3,955-$5,495
Activity variance=$1,540 Favorable
Therefore the Activity variance for cleaning equipment and supplies in September is closest to:$1,540 Favourable reason been that the flexible budget is lesser than the planning budget
