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 activity variance for administrative expenses in June would be closest to:
A)$269 F
B)$1 U
C)$269 U
D)$1 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 activity variance for administrative expenses in June would be closest to:

Data used in budgeting:
 Actual results for June: 
-The activity variance for administrative expenses in June would be closest to:
A)$269 F 
B)$1 U 
C)$269 U 
D)$1 F

Quizplus · Accepted Answer

The activity variance is calculated as the difference between the flexible budget and the actual results. If the variance is unfavorable (U), it means the actual expenses were higher than expected.

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