Borunda Air Uses Two Measures of Activity, Flights and Passengers

question 110

Multiple Choice

Borunda Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $37,020 per month plus $2,731 per flight plus $6 per passenger. The company expected its activity in July to be 73 flights and 253 passengers, but the actual activity was 75 flights and 251 passengers. The actual cost for plane operating costs in July was $231,770. The activity variance for plane operating costs in July would be closest to:

• A)$6,131 F
• B)$5,450 F
• C)$6,131 U
• D)$5,450 U

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Definitions:

Metering Valve

Used on vehicles equipped with hydraulic front disc and rear drum brakes to improve brake balance; holds off application pressure to front brakes until pressure builds in the hydraulic circuit to move the rear shoes into contact with the brake drums.

Proportioning Valve

A hydraulic brake valve used on vehicles equipped with front disc and rear drum brake. Its function is to reduce application pressure to the rear drum brakes to prevent premature lockup under severe braking.

Proportioning Valve

A valve in a vehicle's brake system that modulates the pressure to the rear brakes to prevent them from locking up during braking.

Rear Wheel Lock-up

A dangerous condition where the rear wheels of a vehicle cease to rotate while in motion, often leading to loss of control.