Grey Corporation uses customers served as its measure of activity. The following

Question

Grey 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 May:

1. Prepare the company's flexible budget performance report for May. Label each variance as favorable (F) or unfavorable (U). (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Omit the "$" sign in your response.)

Grey 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 May:

Explanation / Answer

  

For the Month Ended May 31

Tajiri Corporation Flexible Budget Performance Report Part 1 & 2

For the Month Ended May 31

Planning Budget Activity Variances Flexible Budget Revenue and Spending Variances Actual Results Customers served 37,000 1,000 (F) 38,000 None 38,000 Revenue $129,500 $3,500(F) $133,000 $800 (F) $133,800 Expenses: Wages and salaries $70,690 $1,270(U) $71,960 None $71,960 Supplies $24,790 $670(U) $25,460 $3,170(F) $22,290 Insurance $5,600 None $5,600 None $5,600 Miscellaneous expense $17,920 $360(U) $18,280 $2,860(F) $15,420 Total expense $119,000 $2,300(U) $121,300 $6,030(F) $115,270 Net operating income $10,500 $1,200(F) $11,700 6,830(F) $18,530

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