Copyright

Ingrum Framing's cost formula for its supplies cost is $1,220 per month plus $11 per frame. For...

Question:

Ingrum Framing's cost formula for its supplies cost is $1,220 per month plus $11 per frame. For the month of June, the company planned for activity of 620 frames, but the actual level of activity was 612 frames. The actual supplies cost for the month was $7,650. The spending variance for supplies cost in June would be closest to:

a. $390 U

b. $302 U

c. $390 F

d. $302 F

Spending Variances:

Spending variances calculate the difference between actual and budgeted figures. The formula is : Actual cost incurred - Budgeted cost with actual number of units . A negative result is a favorable variance since the company spent less than expected.

Answer and Explanation:

See full answer below.

Become a Study.com member to unlock this answer! Create your account

View this answer

Learn more about this topic:

Variance Formulas for Cost Accounting

from Accounting 303: Cost Accounting

Chapter 3 / Lesson 5
775

Explore our homework questions and answer library