A fraternity held a party.The fraternity prepared the following budget for 25 expected attendees:
$\begin{array}{ll}
\text { Room rental }&\$150\
\text { Food } & 250 \
\text { Entertainment } & 150 \
\text { Decorations } & 75\
\text { Total Costs }&\$625
\end{array}$
Twenty-five people attended the party.The following costs were incurred:
$$\begin{array} { l l }
\text { Room rental } & \$ 240 \
\text { Food } & 320 \
\text { Entertainment } & 125 \
\text { Decorations } & 75 \
\text { Total Costs } & \$ 760
\end{array}$$
What is the variance for total costs?

Question

A fraternity held a party.The fraternity prepared the following budget for 25 expected attendees:
$\begin{array}{ll}
\text { Room rental }&\$150\
\text { Food } & 250 \
\text { Entertainment } & 150 \
\text { Decorations } & 75\
\text { Total Costs }&\$625
\end{array}$
Twenty-five people attended the party.The following costs were incurred:
$$\begin{array} { l l } 
\text { Room rental } & \$ 240 \
\text { Food } & 320 \
\text { Entertainment } & 125 \
\text { Decorations } & 75 \
\text { Total Costs } & \$ 760
\end{array}$$
What is the variance for total costs?

Quizplus · Accepted Answer

The variance for total costs is calculated as the difference between the actual costs and the budgeted costs. The actual total costs were $760, and the budgeted total costs were $625. Therefore, the variance is $760 - $625 = $135 Unfavorable, because the actual costs were higher than the budgeted costs.

A Fraternity Held a Party Twenty-Five People Attended the Party