Bruer Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting: Revenue Tour guide wages Vehicle expenses Administrative expenses Fixed element Variable element per Variable element per per month guest jeep $ 0 $ 179 $ 0 $ 0 $ 0 $ 180 $ 5,800 $ 2,900 $ 19 $ 10 $ 57 $ 0 In November, the company budgeted for 366 guests and 161 jeeps. The actual activity for the month was 382 guests and 148 jeeps. Required: Prepare a report showing the company's activity variances for November. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Guests Jeeps Revenue Expenses: Tour guide wages Vehicle expenses Administrative expenses Bruer Jeep Tours Activity Variances For the Month Ended November 30 Planning Flexible Budget Activity Variances Budget 382 366 148 161

Bruer Jeep Tours operates jeep tours in the heart of the Colorado Rockies. The company bases its budgets on two measures of activity (i.e., cost drivers), namely guests and jeeps. One vehicle used in one tour on one day counts as a jeep. Each jeep has one tour guide. The company uses the following data in its budgeting: Revenue Tour guide wages Vehicle expenses Administrative expenses Fixed element Variable element per Variable element per per month guest jeep $ 0 $ 179 $ 0 $ 0 $ 0 $ 180 $ 5,800 $ 2,900 $ 19 $ 10 $ 57 $ 0 In November, the company budgeted for 366 guests and 161 jeeps. The actual activity for the month was 382 guests and 148 jeeps. Required: Prepare a report showing the company's activity variances for November. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Guests Jeeps Revenue Expenses: Tour guide wages Vehicle expenses Administrative expenses Bruer Jeep Tours Activity Variances For the Month Ended November 30 Planning Flexible Budget Activity Variances Budget 382 366 148 161

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter12: Activity-based Management

Section: Chapter Questions

Problem 25P: Novo, Inc., wants to develop an activity flexible budget for the activity of moving materials. Novo...

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