Question

Petrus Framing's cost formula for its supplies cost is $1,890 per month plus $9 per frame. For the month of March, the company planned for activity of 629 frames, but the actual level of activity was 634 frames. The actual supplies cost for the month was $7,860. The activity variance for supplies cost in March would be closest to: Multiple Choice $309 F $309 U $45 F $45 U

Answer 1

Activity variance= $310 unfavorable

Step-by-step explanation:

To calculate the activity variance, we need to use the standard costs and planned activity:

Activity variance= standard cost*planned activity - actual costs

Activity variance= (1,890 + 9*629) - 7,860

Activity variance= 7,551 - 7,860

Activity variance= $310 unfavorable