The following two items are from Marcia White's "Dining Out" expense category:
(1)January monthly variance = $25 (favorable);
(2)February cumulative variance = -$10 (unfavorable).
If Marcia budgeted $85 a month for this activity,we know that she
A)spent $60 in January and $95 in February.
B)spent $60 in January and $120 in February.
C)can bring the activity back within budget by spending $85 in March.
D)has not budgeted properly.

Question

Quizplus · Accepted Answer

From the first item, we know that Marcia spent $25 less than her budgeted amount in January, which means she spent $85-$25=$60 in January. 
From the second item, we know that her cumulative variance (total difference between actual spending and budgeted amount) for February is -$10, which means she spent $85-$10=$75 in February. 
Therefore, her total spending for the two months is $60+$75=$135, which is $50 more than her budgeted amount of $85. 
To bring the activity back within budget, she needs to spend $85-$135+$60=$10 in March.

The Following Two Items Are from Marcia White's "Dining Out