Ask Question
21 June, 08:02

Dermody Snow Removal's cost formula for its vehicle operating cost is $2,990 per month plus $329 per snow-day. For the month of December, the company planned for activity of 23 snow-days, but the actual level of activity was 21 snow-days. The actual vehicle operating cost for the month was $10,860. The spending variance for vehicle operating cost in December would be closest to:

+3
Answers (1)
  1. 21 June, 08:48
    0
    -$303 Unfavorable

    Explanation:

    The computation of spending variance is shown below:-

    Spending variance = Flexible budget - Actual cost

    = (23 * $329 + $2,990) - $10,860

    = $7,567 + $2,990 - $10,860

    = $10,557 - $10,860

    = - $303 Unfavorable

    Therefore for computing the spending variance we simply subtracted the actual cost from flexible budget.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Dermody Snow Removal's cost formula for its vehicle operating cost is $2,990 per month plus $329 per snow-day. For the month of December, ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers