Ruozzo Corporation Is a Service Company That Measures Its Output

question 331

Multiple Choice

Ruozzo Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for July. When the company prepared its planning budget at the beginning of July, it assumed that 27 customers would have been served. However, 22 customers were actually served during July.The activity variance for net operating income for July would have been closest to:

• A) $16,400 F
• B) $15,500 F
• C) $15,500 U
• D) $16,400 U

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Definitions:

Groupthink

A psychological phenomenon in which the desire for harmony and conformity within a group results in an irrational or dysfunctional decision-making outcome.

Opinionated Team Leader

A leader who strongly holds and expresses their personal views and beliefs, influencing team dynamics and decisions.

External Threat

Factors or circumstances outside an organization that pose a risk to its stability, success, or survival.

Team Success

The achievement of a group's objectives or goals, often measured by factors such as performance, collaboration, and the attainment of desired outcomes.