Skoff 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 March. When the company prepared its planning budget at the beginning of March, it assumed that 35 containers would have been refurbished. However, 32 containers were actually refurbished during March.
The activity variance for "Other expenses" for March would have been closest to:
A) $0
B) $4,100 U
C) $500 F
D) $500 U

Question

Skoff 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 March.  When the company prepared its planning budget at the beginning of March, it assumed that 35 containers would have been refurbished. However, 32 containers were actually refurbished during March.
The activity variance for "Other expenses" for March would have been closest to:
A) $0 
B) $4,100 U 
C) $500 F 
D) $500 U

Quizplus · Accepted Answer

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Skoff Corporation Is a Shipping Container Refurbishment Company That Measures