Payeur Corporation Uses Customers Served as Its Measure of Activity

Essay

Payeur Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $4.50 per customer served. Wages and salaries should be $38,300 per month plus $1.40 per customer served. Supplies should be $0.80 per customer served. Insurance should be $10,100 per month. Miscellaneous expenses should be $5,400 per month plus $0.40 per customer served.
The company reported the following actual results for December: Required:
Prepare a report showing the company's revenue and spending variances for December. Label each variance as favorable (F) or unfavorable (U).