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:

Dissatisfying

Causing discontent or discomfort; not meeting an individual's expectations or desires.

Existing Group

A set of individuals who are currently assembled as a team or cohort within an organization or for a specific purpose.

Sole Basis

The only reason or foundation upon which a decision or action is based.

Job Description

A formal account of an employee's responsibilities, duties, and the requirements for a specific position within an organization.