Stegemann Corporation Is a Shipping Container Refurbishment Company That Measures

question 103

Multiple Choice

Stegemann 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 May. When the company prepared its planning budget at the beginning of May, it assumed that 27 containers would have been refurbished. However, 29 containers were actually refurbished during May.The activity variance for total expenses for May would have been closest to:

• A) $3,600 Favorable
• B) $3,600 Unfavorable
• C) $4,900 Unfavorable
• D) $4,900 Favorable

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