Fuquay Corporation Uses Customers Served as Its Measure of Activity

Essay

Fuquay Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $4.80 per customer served. Wages and salaries should be $26,500 per month plus $1.70 per customer served. Supplies should be $0.90 per customer served. Insurance should be $7,100 per month. Miscellaneous expenses should be $4,700 per month plus $0.20 per customer served.
The company reported the following actual results for May:
Required:
Prepare a report showing the company's revenue and spending variances for May. Label each variance as favorable (F) or unfavorable (U).