Nobriga Corporation uses customers served as its measure of activity. During October, the company budgeted for 29,000 customers, but actually served 33,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October:Data used in budgeting:??Fixed element per monthVariable element per customer?Revenue-$2.90?Wages and salaries$25,500$0.80?Supplies$0$0.30?Insurance$6,000$0.00?Miscellaneous expense$3,700$0.40Actual results for October:?Revenue$94,500?Wages and salaries$51,100?Supplies$12,100?Insurance$3,600?Miscellaneous expense$16,900Required:Prepare a report showing the company's revenue and spending variances for October. Label each variance as favorable (F) or unfavorable (U).
What will be an ideal response?
| Nobriga Corporation Revenue and Spending Variances For the Month Ended October 31 | ||||
| ? | ? | Actual Results | Flexible Budget | Revenue and Spending Variances |
| ? | Customers served (q) | 33,000 | 33,000 | ? | ? |
| ? | ? | ? | ? | ? | ? |
| ? | Revenue ($2.90q) | $95,700 | $94,500 | $1,200 | U |
| ? | Expenses: | ? | ? | ? | ? |
| ? | Wages and salaries ($25,500 + $0.80q) | 51,900 | 51,100 | 800 | F |
| ? | Supplies ($0.30q) | 9,900 | 12,100 | 2,200 | U |
| ? | Insurance ($6,000) | 6,000 | 3,600 | 2,400 | F |
| ? | Miscellaneous expense ($3,700 + $0.40q) | 16,900 | 16,900 | 0 | ? |
| ? | Total expense | 84,700 | 83,700 | 1,000 | F |
| ? | Net operating income | $11,000 | $10,800 | $200 | U |
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