Question

The following is total monthly budgeted cost and activity information for the four activity centers in...

The following is total monthly budgeted cost and activity information for the four activity centers in the billing department of Oregon Power Company:

Activity Center

Variable

Fixed

Cost Driver
Statement inquiry

$81,180

$166,000

3,300 labor hours
Correspondence

$9,884

$23,000

2,800 letters
Account billing

$175,000

$76,000

2,500,000 lines
Payment verification

$10,865

$79,000

20,500 accounts


In September, actual costs and activity were as follows:

Activity Center

Total Costs

Driver Amount
Statement inquiry

$245,499

3,250 labor hours
Correspondence

$33,036

2,820 letters
Account billing

$241,967

2,370,000 lines
Payment verification

$89,786

20,450 accounts


Required
Compute the flexible-budget variances for the following two activity cost items (round all answers to the nearest dollar and enter favorable variances as positive numbers and unfavorable variances as negative numbers):

  Correspondence ?

  Payment verification ?

Business   Accounting   
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