Genito Corporation's Static Planning Budget for October Appears Below

question 253

Multiple Choice

Genito 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 8,800, the actual supplies cost was $69,450, the actual power cost was $34,190, the actual salaries cost was $86,490, and the actual equipment depreciation was $37,600.
-The spending variance for supplies cost in the flexible budget performance report for the month should be:

• A) $4,500 F
• B) $7,110 F
• C) $7,110 U
• D) $4,500 U

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Definitions:

Capital

The financial resources or assets owned by a business used to fund its operations and growth.

Temporary Account

An account used to track transactions for a single accounting period, closed at the end and its balances are transferred to permanent accounts.

Withdrawals

Amounts of money taken out from a business by its owner(s) for personal use.

Capital

Capital refers to financial assets or resources that businesses use to fund their operations and invest in their growth, such as cash, machinery, and buildings.