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Mondo Snow Removal's cost formula for its vehicle operating cost is $1,980 per month plus $696 per snow-day. For the month of January, the company planned for activity of 13 snow-days, but the actual level of activity was 17 snow-days. The actual vehicle operating cost for the month was $13,430. The activity variance for vehicle operating cost in January would be closest to:

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Tundexi

Answer:

The activity variance for vehicle operating cost for the month of January is $2,784 U

Explanation:

Activity Variance = Actual Activity -   Standard Activity * Standard Rate

Activity Variance = Actual snow days - Standard snow days * Standard Rate

Activity Variance = (17 - 13) * $696

Activity Variance = 4 * $696

Activity Variance = $2,784 Unfavorable

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