Piechocki Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 6000 units, but its actual level of activity was 5950 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May:Data used in budgeting: Fixed element per monthVariable element per unitRevenue - $33.50? Direct labor$0? $5.50?Direct materials 0? 13.10?Manufacturing overhead 30,000? 1.00?Selling and administrative expenses 24,800? 0.20?Total expenses$54,800? $19.80??Actual results for May: Revenue$200,050?Direct labor$32,500?Direct materials$80,100?Manufacturing
overhead$40,000?Selling and administrative expenses$30,400?The activity variance for direct labor in May would be closest to:
A. $275 U
B. $500 F
C. $275 F
D. $500 U
Answer: C
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