Schoening Corporation Is a Shipping Container Refurbishment Company That Measures

question 208

Multiple Choice

Schoening 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 January. When the company prepared its planning budget at the beginning of January, it assumed that 40 containers would have been refurbished. However, 38 containers were actually refurbished during January.The activity variance for "Refurbishing materials" for January would have been closest to:

• A) $1,400 U
• B) $1,000 F
• C) $1,000 U
• D) $1,400 F

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Definitions:

Incurred Costs

Expenses that have been realized in the course of business operations.

Alternatives

Different options or choices available in a decision-making process.

Traceable

Costs or items that can be directly linked or attributed to a specific product, job, or department, facilitating accurate costing and financial analysis.

Avoidable Cost

A cost that can be eliminated by choosing one alternative over another in a decision. This term is synonymous with differential cost and relevant cost.