FINANCIAL ACCOUNTING
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Transcribed Image Text:Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company
harvested and sold 7,100 pounds of oysters in August. The company's flexible budget for
August appears below:
Quilcene Oysteria
Flexible Budget
For the Month Ended August 31
Actual pounds (q)
Revenue ($4.10g)
7,100
$ 29,110
Expenses:
Packing supplies ($0.35q)
Oyster bed maintenance ($3,300)
Wages and salaries ($2,500 + $0.30q)
Shipping ($0.55g)
Utilities ($1,230)
Other ($440 + $0.01q)
Total expense
2,485
3,300
4,630
3,905
1,230
511
16,061
$ 13,049
Net operating income
The actual results for August appear below:
Quilcene Oysteria
Income Statement
For the Month Ended August 31
Actual pounds
7,100
Revenue
$ 27,500
Expenses:
Packing supplies
Oyster bed maintenance
Wages and salaries
Shipping
2,655
3,160
5,040
3,635
1,040
1,131
Utilities
Other
16,661
$ 10,839
Total expense
Net operating income
Required:
Calculate the company's revenue and spending variances for August. (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.)
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