Question

AirQual Test Corporation provides on-site air quality testing services. The company has provided the following cost formulas and actual results for the month of February: Revenue Technician wages Mobile lab operating expenses office expenses Advertising expenses Insurance Miscellaneous expenses Variable Fixed Component Component per Actual Total per Month Job for February $ 280 $ 39,250 $ 8,100 $ 7,950 $ 5,000 $ 33 $ 9,790 $ 2,500 $ 3 $ 2,800 $ 1,580 $ 1,650 $ 2,860 $ 2,860 $ 920 $ 1 $ 375 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $5,000 plus $33 per job, and the actual mobile lab operating expenses for February were $9,790. The company expected to work 150 jobs in February, but actually worked 152 jobs.

Answer 1

	Actual results	Revenue and spending variances		Flexible budget	Activity variances		Planning budget
Jobs	152			152			150
Revenue	39250	3310	U	42560	560	F	42000
Expenses:
Technician wages	7950	150	F	8100	0	None	8100
Mobile lab operating expenses	9790	226	F	10016	66	U	9950
Office expenses	2800	156	F	2956	6	U	2950
Advertising expenses	1650	70	U	1580	0	None	1580
Insurance	2860	0	None	2860	0	None	2860
Miscellaneous expenses	375	697	F	1072	2	U	1070
Total expense	25425	1159	F	26584	74	U	26510
Net operating income	13825	2151	U	15976	486	F	15490