Sammy Three Fingers Diaper Service cost formula for its supplies cost is $2,500 per month plus $10 per diaper change

Accounting Dec 01, 2020

Sammy Three Fingers Diaper Service cost formula for its supplies cost is $2,500 per month plus $10 per diaper change. For the month of September, the company planned for activity of 600 diaper changes, but the actual level of activity was 666 changes. The actual supplies cost for the month was $9.980. The spending variance in September would be closest to: Actual Cost Flex Budget Planning Budget
$660F $6600 $8200 $820F

Expert Solution

Spending variance = Actual cost - ( actual activity x variable cost) - budgeted fixed cost

Spending variance = 9,980 - ( 666 x 10) - 2,500

Spending variance = 9,980 - 6,660 - 2,500

Spending variance = $820U

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