Mattison Company has developed cost formulas for the drivers of the following production activities:

Driver	Activity	Fixed	Variable
Labor hours	Materials	$ -0-	$20
Labor hours	Labor	-0-	10
Machine hours	Maintenance	10,000	8
Machine hours	Machining	50,000	2
Number of setups	Inspections	30,000	200
Number of setups	Setups	-0-	300
Number of purchase orders	Purchasing	75,000	3

The activity levels are projected to be as follows:

Labor hours	1,000
Machine hours	5,000
Setups	100
Purchase orders	50

What is budgeted for this projected activity level?

a. $3,504,450

b. $295,150

c. $1,655,430

d. $165,543

If the actual activity was 20 setups and the actual fixed cost for inspections was $28,000 and the variable cost for inspections was $5,000, the total variance for inspections is

a. $2,000 favorable.

b. $2,000 unfavorable.

c. $1,000 favorable.

d. $1,000 unfavorable.

Answer rating: 100% (QA)

1 B 295150 Working Activity Driver Driver units Cost per unit Vari... View the full answer