Dinham Kennel Uses Tenant-Days as Its Measure of Activity; an Animal

question 385

Multiple Choice

Dinham Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,040 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March:Data used in budgeting: Actual results for March:
The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for March would be closest to:

• A) $1,960 F
• B) $1,960 U
• C) $1,396 U
• D) $1,396 F

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Definitions:

Portfolio

A group of investment vehicles comprising stocks, bonds, commodities, as well as cash and its equivalents, together with mutual funds and ETFs.

Adverse Selection

Adverse selection refers to a situation where sellers have information that buyers do not, or vice versa, about some aspect of product quality.

Utility Function

A mathematical representation of how consumers rank different bundles of goods according to their level of satisfaction or utility.

Wealth

The presence of significant financial assets or tangible property that can be transformed into a medium suitable for trade.