Zindell Corporation Bases Its Budgets on the Activity Measure Customers

Essay

Zindell Corporation bases its budgets on the activity measure customers served.During December,the company planned to serve 21,000 customers,but actually served 19,000 customers.The company uses the following revenue and cost formulas in its budgeting,where q is the number of customers served:

Revenue: $3.60q
Wages and salaries: $21,300 + $1.10q
Supplies: $0.70q
Insurance: $6,400
Miscellaneous: $3,200 + $0.20q

Required:
Prepare a report showing the company's activity variances for December.Indicate in each case whether the variance is favorable (F)or unfavorable (U).