Marsee 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 June, the kennel budgeted for 2,500 tenant-days, but its actual level of activity was 2,510 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for June:

Data used in budgeting:
Actual results for June:
-The spending variance for expendables in June would be closest to:
A)$890 U
B)$890 F
C)$989 U
D)$989 F

Question

Marsee 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 June, the kennel budgeted for 2,500 tenant-days, but its actual level of activity was 2,510 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for June:

Data used in budgeting:

Actual results for June:

-The spending variance for expendables in June would be closest to:

Data used in budgeting:
 Actual results for June: 
-The spending variance for expendables in June would be closest to:
A)$890 U 
B)$890 F 
C)$989 U 
D)$989 F

Quizplus · Accepted Answer

The spending variance is calculated as the difference between the actual spending and the budgeted spending. In this case, the actual spending is $10,890 and the budgeted spending is $10,000. Therefore, the spending variance is $10,890 - $10,000 = $890. The correct answer is A.

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