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For Fancy Nails, the budgeted revenue is $20 per manicure. The planning budget for June was based on 2,400 manicures. During June, the actual revenue was $49,750 for 2,500 manicures. What is the revenue variance for June?

a. $250 Unfavorable
b. $1,750 Favorable
c. $1,750 Unfavorable
d. $250 Favorable

User Amna Ali
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1 Answer

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Final answer:

The revenue variance for June is calculated by comparing the actual revenue to the budgeted revenue based on the actual number of manicures. With an actual revenue of $49,750 for 2,500 manicures against a budgeted revenue of $50,000, there is a $250 Unfavorable variance.

Step-by-step explanation:

To calculate the revenue variance for June, you must compare the actual revenue to the budgeted revenue. The budgeted number of manicures was 2,400 with a revenue of $20 per manicure, totaling $48,000 in budgeted revenue. With the actual revenue being $49,750 for 2,500 manicures, we can calculate the variance.

Actual Revenue: $49,750
Budgeted Revenue for actual number of manicures (2,500 x $20): $50,000
Variance: $49,750 - $50,000 = -$250

Since the actual revenue is $250 less than what was budgeted for the actual number of manicures, we have an unfavorable variance. Therefore, the correct answer is (a) $250 Unfavorable.

User Amiel
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