Brong Corporation Is a Shipping Container Refurbishment Company That Measures

question 312

Multiple Choice

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. 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 "Refurbishing materials" for March would have been closest to:

• A) $1,500 F
• B) $500 F
• C) $1,500 U
• D) $500 U

---

Definitions:

Common Stock

A type of ownership in a corporation represented by shares, entitling holders to vote on corporate matters and receive dividends.

Trading Investments

Securities that a company holds for the purpose of selling them in the short term to profit from price differences.

Valuation Allowance

A reserve established against deferred tax assets that may not be realized, ensuring that the asset's carrying amount does not exceed its likely realization.

Balance Sheet

A document showing a summary of a corporation's assets, liabilities, and equity of its shareholders at a certain moment, offering a glimpse into its financial health.