Prepare a report showing the company activity variances

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Reference no: EM133050156

Problem - Bruer Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting:

 

Fixed element per month

Variable element per guest

Variable element per jeep

Revenue

$0

$173

$0

Tour guide wages

$0

$0

$183

Vehicle expenses

$5,500

$16

$60

Administrative expenses

$2,600

$7

$0

In November, the company budgeted for 360 guests and 155 jeeps. The actual activity for the month was 379 guests and 145 jeeps.

Required - Prepare a report showing the company's activity variances for November. Label each variance as favorable (F) or unfavorable (U).

Reference no: EM133050156

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