Homework SourseQuilcene Oysteria farms and sells oysters in the Pacific Nor
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,100 pounds of oysters in August. The company’s flexible budget for August appears below:
The actual results for August appear below:
Required:
Calculate the company’s revenue and spending variances for August. (Indicate the effect of each variance by selecting \"F\" for favorable, \"U\" for unfavorable, and \"None\" for no effect (i.e., zero variance). Input all amounts as positive values.)
| Quilcene Oysteria | ||
| Flexible Budget | ||
| For the Month Ended August 31 | ||
| Actual pounds (q) | 7,100 | |
| Revenue ($4.15q) | $ | 29,465 |
| Expenses: | ||
| Packing supplies ($0.30q) | 2,130 | |
| Oyster bed maintenance ($3,500) | 3,500 | |
| Wages and salaries ($2,300 + $0.40q) | 5,140 | |
| Shipping ($0.75q) | 5,325 | |
| Utilities ($1,300) | 1,300 | |
| Other ($410 + $0.01q) | 481 | |
| Total expense | 17,876 | |
| Net operating income | $ | 11,589 |
Solution
Revenue and spending variance :
| Revenue | 2165 | U |
| Expenses | ||
| Packing supplies | 170 | U |
| Oyster bed maintenance | 140 | F |
| Wages and salaries | 410 | U |
| Shipping | 270 | F |
| Utilities | 190 | F |
| Other | 620 | U |
| Total expense | 600 | U |
| Net operating income | 2765 | U |
