Chap 9 Q1 Jake’s Roof Repair has provided the following data concerning its cost

Question

Chap 9 Q1

Jake’s Roof Repair has provided the following data concerning its costs:

For example, wages and salaries should be $21,400 plus $15.00 per repair-hour. The company expected to work 2,900 repair-hours in May, but actually worked 2,800 repair-hours. The company expects its sales to be $50.00 per repair-hour.

Compute the company’s activity variances for May. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

Jake’s Roof Repair has provided the following data concerning its costs:

Explanation / Answer

Jake's Roof Repair Activity Variances For Month Ended May 31 Flexible Budget Planning Budget Activity Variances Repair Hours 2,800 2,900 Revenue 140,000 145,000 (5,000) U Expenses: Wages and Salaries(42,000+21,400), (43,500+21,400) 63,400 64,900 1,500 F Parts and supplies 21,000 21,750 750 F Equipment Depreciation (2,760+980),(2,760+1,015) 3,740 3,775 35 F Truck Operating Expenses(5,770+4,480),(5,770+4,640) 10,250 10,410 160 F Rent 4,620 4,620 Administrative Expenses(3,890+1,400),(3,890+1,450) 5,290 5,340 50 F Total Expense 108,300 110,795 2,495 F Net Operating Income 31,700 34,205 (2,505) U

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