Deleston Boat Wash's cost formula for its cleaning equipment and supplies is $2,150 per month plus $21 per boat. For the month of September, the company planned for activity of 79 boats, but the actual level of activity was 39 boats. The actual cleaning equipment and supplies for the month was $3,110.
-The activity variance for cleaning equipment and supplies in September would be closest to:

Question

Quizplus · Accepted Answer

The activity variance is calculated by comparing the planned cost for the actual activity level to the planned cost for the planned activity level. The planned cost for 79 boats is $2,150 + ($21 * 79) = $3,799. The planned cost for 39 boats is $2,150 + ($21 * 39) = $2,969. The variance is $3,799 - $2,969 = $830 F (favorable).

Deleston Boat Wash's Cost Formula for Its Cleaning Equipment and Supplies