Summer Corporation is a shipping container refurbishment company that measures its output by the number of containersrefurbished. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and theactual results of operations for January.RevenueEmployee salaries and wagesRefurbishing materialsOther expensesVariable ElementFixed Element per per ContainerMonthO $1,400 UO $1,000 FO $1,000 UO $1,400 FSS50,60041,200RefurbishedActual Totalfor JanuaryS 4,100 SS 1,100 SS 700 SS158,60092,70027,00040,800When the company prepared its planning budget at the beginning of January, it assumed that 40 containers would have beenrefurbished. However, 38 containers were actually refurbished during January.The activity variance for "Refurbishing materials" for January would have been closest to:

Actual production = 38 units Planned production = 40 units Standard rate per unit = $700 Activity…

Summer Corporation is a shipping container refurbishment company that measures its output by the number of containers refurbished. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for January. Revenue Employee salaries and wages Refurbishing materials Other expenses Fixed Element per Month O $1,400 U O $1,000 F O $1,000 U O $1,400 F S 50,600 S 41,200 Variable Element per Container Actual Total Refurbished for January S 4,100 S $ 1,100 S 700 S S S 158,600 92,700 27,000 40,800 When the company prepared its planning budget at the beginning of January, it assumed that 40 containers would have been refurbished. However, 38 containers were actually refurbished during January. The activity variance for "Refurbishing materials" for January would have been closest to:

Summer Corporation is a shipping container refurbishment company that measures its output by the number of containers refurbished. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for January. Revenue Employee salaries and wages Refurbishing materials Other expenses Fixed Element per Month O $1,400 U O $1,000 F O $1,000 U O $1,400 F S 50,600 S 41,200 Variable Element per Container Actual Total Refurbished for January S 4,100 S $ 1,100 S 700 S S S 158,600 92,700 27,000 40,800 When the company prepared its planning budget at the beginning of January, it assumed that 40 containers would have been refurbished. However, 38 containers were actually refurbished during January. The activity variance for "Refurbishing materials" for January would have been closest to:

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter23: Flexible Budgeting (flexbud)

Section: Chapter Questions

Problem 1R

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