When the company prepared its planning budget at the beginning of April, it assumed that 32 wells would have been serviced. However, 29 wells were actually serviced during April. The activity variance for total expenses for April would have been closest to: A. $4,200 F B. $1,000 F C. $1,000 U D. $4,200 U

A. $4,200 F

Explanation:

Activity Variance is the difference between actual cost and the cost of the flexible budget. In the given scenario the actual wells serviced were 29 whereas budget wells to be serviced were 32. The difference is 3 wells. The 3 wells are less serviced than planned which is favorable for an organization. The activity variance will be calculated by multiplying the employee salary and wages plus well servicing material. The total expense will be $1,400 ($900 + $500). The activity variance for total expenses for April will be $4,200F ($1,400 * 3 wells).

in terms of experimental research, mcdonald’s charging different prices in the two cities relates to