In: Accounting
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:
Fixed Component per Month |
Variable Component per Job |
Actual Total for February |
|||||||
Revenue | $ | 277 | $ | 36,030 | |||||
Technician wages | $ | 8,500 | $ | 8,350 | |||||
Mobile lab operating expenses | $ | 4,500 | $ | 31 | $ | 8,680 | |||
Office expenses | $ | 2,800 | $ | 3 | $ | 3,070 | |||
Advertising expenses | $ | 1,610 | $ | 1,680 | |||||
Insurance | $ | 2,880 | $ | 2,880 | |||||
Miscellaneous expenses | $ | 950 | $ | 2 | $ | 535 | |||
The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4,500 plus $31 per job, and the actual mobile lab operating expenses for February were $8,680. The company expected to work 140 jobs in February, but actually worked 146 jobs.
Required:
Prepare a flexible budget performance report showing AirQual Test Corporation’s revenue and spending variances and activity variances for February