Vieyra Corporation uses customers served as its measure of activity. During November, the company budgeted for 36,000 customers, but actually served 39,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:
Revenue: $2.50q
Wages and salaries: $21,500 + $0.70q
Supplies: $0.40q
Insurance: $6,100
Miscellaneous: $3,700 + $0.40q
The company reported the following actual results for November: Required:
Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

Question

Vieyra Corporation uses customers served as its measure of activity. During November, the company budgeted for 36,000 customers, but actually served 39,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:
Revenue: $2.50q
Wages and salaries: $21,500 + $0.70q
Supplies: $0.40q
Insurance: $6,100
Miscellaneous: $3,700 + $0.40q
The company reported the following actual results for November:  Required:
Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

Quizplus · Accepted Answer

The Answer of Vieyra Corporation uses customers served as its measure of activity. During November, the company budgeted for 36,000 customers, but actually served 39,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:
Revenue: $2.50q
Wages and salaries: $21,500 + $0.70q
Supplies: $0.40q
Insurance: $6,100
Miscellaneous: $3,700 + $0.40q
The company reported the following actual results for November:  Required:
Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).

Vieyra Corporation Uses Customers Served as Its Measure of Activity