Question

Cicchetti Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of December: Cicchetti Corporation Comparison of Actual Results to Planning Budget For the Month Ended December 31 Actual Results Planning Budget Variances Customers served 40,000 35,000 Revenue ($4.8q) $ 192,400 $ 168,000 $ 24,400 F Expenses: Wages and salaries ($36,300 + $1.7q) 106,600 95,800 10,800 U Supplies ($0.9q) 35,300 31,500 3,800 U Insurance ($13,300) 13,700 13,300 400 U Miscellaneous expense ($6,300 + $0.4q) 23,650 20,300 3,350 U Total expense 179,250 160,900 18,350 U Net operating income $ 13,150 $ 7,100 $ 6,050 F Required: Prepare the company's flexible budget performance report for December. Select each variance as favorable (F), unfavorable (U) or "None". Noreen 4e Rechecks 2017-31-03

Answer 1

: Prepare the company's flexible budget performance report for December. Select each variance as favorable (F), unfavorable (U) or "None".

	Actual results	Revenue and spending variance	Flexible budget	Activity variance	Static budget
Customer served	40000		40000		35000
Revenue	192400	400 F	192000	24000 F	168000
Expenses
Wages and salaries	106600	2300 U	104300	8500 U	95800
Supplies	35300	700 F	36000	4500 U	31500
Insurance	13700	400 U	13300	0 None	13300
Miscellaneous expense	23650	1350 U	22300	2000 U	20300
Total expense	179250	3350 U	175900	15000 U	160900
Net operating income	13150	2950 U	16100	9000 F	7100