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What is the total operating income variance for august

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Reference no: EM132611425

Rent Locaters Inc. helps owners of rental properties find renters and charges the owners one-half of the first month's rent for the service. For August 2019, Rent Locaters expects to find renters for 100 apartments with an average first month's rent of $920.

Budgeted cost data per tenant application for 2019 is as follows:

Professional labor: 1.5 hours at $20.00 per hour
Credit checks: $61.00

  • Rent Locaters Inc. expects other costs, including the lease payment for the building, secretarial help, and utilities, to be $4,100 per month. On average, the company is successful in placing one tenant for every three applicants.
  • Actual rental applications in August 2019 were 270. Rent Locaters paid $8,700 for 390 hours of professional labor. Credit checks went up to $66 per application. Other costs in August 2019 (lease, secretarial help, and utilities) were $4,700. The average first monthly rentals for August 2019 were $1,020 per apartment unit for 90 units.

Required:

Question 1. (a) What is the total operating income variance for August 2019? (b) What is the total flexible-budget variance for the month? (c) What is the sales volume variance for the month?

Question 2. Determine the professional labor rate and labor efficiency variances for August 2019.

Reference no: EM132611425

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