Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold...
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Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,200 pounds of oysters in August. The companys flexible budget for August appears below:
Quilcene Oysteria
Flexible Budget
For the Month Ended August 31
Actual pounds (q)
7,200
Revenue ($4.25q)
$
30,600
Expenses:
Packing supplies ($0.25q)
1,800
Oyster bed maintenance ($3,500)
3,500
Wages and salaries ($2,600 + $0.35q)
5,120
Shipping ($0.75q)
5,400
Utilities ($1,210)
1,210
Other ($440 + $0.01q)
512
Total expense
17,542
Net operating income
$
13,058
The actual results for August appear below:
Quilcene Oysteria
Income Statement
For the Month Ended August 31
Actual pounds
7,200
Revenue
$
27,400
Expenses:
Packing supplies
1,970
Oyster bed maintenance
3,360
Wages and salaries
5,530
Shipping
5,130
Utilities
1,020
Other
1,132
Total expense
18,142
Net operating income
$
9,258
Required:
Calculate the companys revenue and spending variances for August.
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