1. We-rescue-Dogs Kennel had a labor cost budget of $100,000 for the year. It expected its staff costs related to grooming, feeding, walking, and so on to vary in direct proportion with the number of dogs , based on an hourly rate of $20 for staff, and a need for 10 hours of staff time per dog (before the dogs were adopted). In its budget for the year, it planned on rescuing 500 dogs. It turned out that it rescued 640 dogs for the year. The staff average cost turned out to be just $16 per hour. Staff were paid a total of 6,000 hours. What is the total labor variance? Was it favorable or unfavorable? Why?

Did the number of dogs rescue result in a favorable or unfavorable volume variance?

1. The Lehman College expected to have 140 students in HAS 304 in spring and fall 2017. Actually, there are 175 students. The college had expected to receive, on average, $ 1,500 per students, after taking scholarship into account. The college received an average of $ 1,300.

a. What was the total revenue variance? b.

Was it favorable or unfavorable?

c. What are the two types of subvariances that caused the total variance?

Pennfoil Company produces retractable pens. March budgeted production costs are given below: Pens to be produced 100,000 Direct material (variable) $33,000 Direct Labor (variable) $48,000 Supplies (variable) $27,500 Supervision (fixed) $40,000 Depreciation (fixed) $22,000 Other (fixed) $10,000 In April, Pennfoil expects to produce 90,000 pens. Assuming no structural changes, what is Pennfoil’s budgeted production cost per pen for April?

A) $1.62 B) $1.72 C) $1.81 D) $1.89

Use the cost information in (1) above. In March, the actual direct labor costs were $46,000 and Pennfoil produced and sold 90,000 pens. The direct labor performance variance (difference) is:

A) $2,800 unfavorable. B) $5,000 unfavorable. C) $1,000 unfavorable. D) $5,000 favorable.

Hoppy Corporation compares monthly operating results to a static budget prepared at the beginning of the month. When the actual level of activity is less than budgeted, which of the following would be true?

A. Fixed costs would show favorable variances.

B. Fixed costs would show unfavorable variances.

C. Variable costs would show favorable variances.