The following is monthly budgeted cost and activity information for two activities in the purchasing department of X Company:
In November, actual costs and activity were as follows:
What was the flexible budget variance for the invoicing activity for November (assume that favorable variances are positive numbers and unfavorable variances are negative numbers):
Solution
Flexible Budget variance for Invoicing Activty for November
Budgeted Invoices - 900 invoices
Actual Invoices - 885 invoices
so 900 -885 = 5 unfavourable
Total cost for budgeted invoices = 11,700 + 28,400
= $40,100
Total Cost for actual invoices = $39,797
Flexible budget variance =40100 - 39797
= $303 favourable
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Micromeritics - Fundamental and Derived Properties of Powders
The following is monthly budgeted cost and activity information for tw (1).docx
1. The following is monthly budgeted cost and activity information for two activities in the
purchasing department of X Company:
In November, actual costs and activity were as follows:
What was the flexible budget variance for the invoicing activity for November (assume that
favorable variances are positive numbers and unfavorable variances are negative numbers):
Activity Variable Costs Fixed Costs Cost Driver
Supplier relations $10,360 $16,900 370 suppliers
Invoicing $11,700 $28,400 900 invoices
Solution
Flexible Budget variance for Invoicing Activty for November
Budgeted Invoices - 900 invoices
Actual Invoices - 885 invoices
so 900 -885 = 5 unfavourable
Total cost for budgeted invoices = 11,700 + 28,400
= $40,100
Total Cost for actual invoices = $39,797
Flexible budget variance =40100 - 39797
= $303 favourable
