Smithj 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 February, the kennel budgeted for 3,500 tenant-days, but its actual level of activity was 3,490 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

Data used in budgeting:

Actual results for February:

-The revenue variance for February would be closest to:
A)$640 F
B)$918 F
C)$640 U
D)$918 U

Question

Smithj 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 February, the kennel budgeted for 3,500 tenant-days, but its actual level of activity was 3,490 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:

Data used in budgeting:

Actual results for February:

-The revenue variance for February would be closest to:

Data used in budgeting:

Actual results for February:

-The revenue variance for February would be closest to:
A)$640 F 
B)$918 F 
C)$640 U 
D)$918 U

Quizplus · Accepted Answer

The actual revenue for February is $18,640 ($19,000 - $360) and the expected revenue is $19,280. Therefore, the revenue variance is $640 unfavorable (actual revenue is less than expected revenue). Option C is the closest answer to this variance.

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