Pattison Corporation Is a Service Company That Measures Its Output

Multiple Choice

Pattison Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes. When the company prepared its planning budget at the beginning of May, it assumed that 20 customers would have been served. However, 17 customers were actually served during May.The activity variance for "Travel expenses" for May would have been closest to:

A) $1,500 U
B) $1,500 F
C) $2,000 F
D) $2,000 U