Zike Corporation's Static Planning Budget for October Appears Below

question 92

Multiple Choice

Zike Corporation's static planning budget for October appears below.The company bases its budgets on machine-hours. In October, the actual number of machine-hours was 6, 000, the actual supplies cost was $14, 740, the actual power cost was $49, 170, the actual salaries cost was $15, 390, and the actual equipment depreciation was $63, 670. The spending variance for supplies cost in the flexible budget performance report for the month should be:

• A)$940 F
• B)$1, 630 U
• C)$940 U
• D)$1, 630 F

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Definitions:

Collateral

An asset or property that a borrower offers to a lender as security for a loan, which the lender can seize if the borrower fails to make required payments.

Installment Loan

A loan that is repaid over time with a set number of scheduled payments.

Stated Annual Rate

The interest rate of a financial product, such as a loan or savings account, as advertised before the effects of compounding and fees.

Cost

The value or price paid to acquire, produce, or maintain a good or service.