Prestridge Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August. When the company prepared its planning budget at the beginning of August, it assumed that 31 customers would have been served. However, 29 customers were actually served during August.The variance for net operating income in the Revenue and Spending Variances column of a report comparing actual results to the flexible budget for August would have been closest to:
A) $4,100 U
B) $4,100 F
C) $1,100 U
D) $1,100 F

Question

Prestridge Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August.  When the company prepared its planning budget at the beginning of August, it assumed that 31 customers would have been served. However, 29 customers were actually served during August.The variance for net operating income in the Revenue and Spending Variances column of a report comparing actual results to the flexible budget for August would have been closest to:
A) $4,100 U 
B) $4,100 F 
C) $1,100 U 
D) $1,100 F

Quizplus · Accepted Answer

The Answer of Prestridge Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August.  When the company prepared its planning budget at the beginning of August, it assumed that 31 customers would have been served. However, 29 customers were actually served during August.The variance for net operating income in the Revenue and Spending Variances column of a report comparing actual results to the flexible budget for August would have been closest to:
A) $4,100 U 
B) $4,100 F 
C) $1,100 U 
D) $1,100 F

Prestridge Corporation Is a Service Company That Measures Its Output