Rhed Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 3,700 tenant-days, but its actual level of activity was 3,650 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting:
Actual results for December:
The spending variance for facility expenses in December would be closest to:
A) $120 U
B) $100 F
C) $120 F
D) $100 U

Question

Rhed Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 3,700 tenant-days, but its actual level of activity was 3,650 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting:
 Actual results for December:
 The spending variance for facility expenses in December would be closest to:
A) $120 U 
B) $100 F 
C) $120 F 
D) $100 U

Quizplus · Accepted Answer

11eacbfc_c58f_e3d7_8ffe_c163291c0d1a_TB7552_00 Because the actual expense is greater than the flexible budget, the variance is unfavorable (U).

Rhed Kennel Uses Tenant-Days as Its Measure of Activity; an Animal