Brong Corporation is a shipping container refurbishment comp

Brong Corporation is a shipping container refurbishment company that measures its output by the number of containers refurbished. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for March. Variable Fixed Element per Actual Element Container Total for Revenue Employee salaries and wages Refurbishing materials Other expenses per Month Refurbished March $5,900 $108,300 $49,50 90e 66,000 $ 500 $ 9,500 39,800 $40,300 When the company prepared its planning budget at the beginning of March, it assumed that 22 containers would have been refurbished However, 18 containers were actually refurbished during March. The spending variance for total expenses for March would have been closest to

Solution

Total actual expenses = 66000+9500+39800= $115300 Expenses in flexible budget = (49500+40300)+18*(900+500)= $115000 Spending variance for total expenses = $115300-115000 = $300 U Option 2 is correct