Reference no: EM132487241

Accounting Information:

The budgeted variable cost per pound of laundry is $0.072

The actual variable cost per pound of laundry is $0.0799

The budgeted volume is 125,000 pounds

The actual volume is 156,600 pounds.

Budgeted fixed cost is $4,000

Actual fixed cost is $4,000

Based on the above figures find the following:

1. original (static) budgeted expense
2. actual expenses.
3. flexible budget expense. (Find total expenses, not expenses per pound of laundry)

Question 1: How much of the total expense variance can be explained by the fact that the laundry produced more output than budgeted?

Question 2: How much of the expense variance can be explained by factors other than the fact the laundry produced more output than budgeted?

Question 3: Are the formulas for expense and revenue variances exactly the same?