Question

13. What is the spending variance related to advertising? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)

14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
15. What is the spending variance related to shipping expenses? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)

Answer 1

The spending variances for advertising, sales salaries and commissions, and shipping expenses can be calculated based on budgeted and actual amounts. An unfavorable variance is incurred when the actual expense exceeds the budgeted amount, while a favorable variance occurs when the actual expense is lower than budgeted.

13. Advertising Spending Variance:

The budgeted advertising expense is $10,000 and the actual advertising expense is $12,000.

The spending variance can be calculated by subtracting the budgeted expense from the actual expense: $12,000 - $10,000 = $2,000.

Since the actual expense is higher than budgeted, it's an Unfavorable variance (U).

The spending variance related to advertising? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)

14. Sales Salaries and Commissions Spending Variance: The budgeted sales salaries and commissions expense is $20,000 and the actual expense is $18,000.

The spending variance is calculated by subtracting the budgeted expense from the actual expense:

$18,000 - $20,000 = -$2,000.

Since the actual expense is lower than budgeted, it's a Favorable variance (F).

The spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)

15. Shipping Expenses Spending Variance: The budgeted shipping expenses are $5,000 and the actual expense is $4,500.

The spending variance is calculated by subtracting the budgeted expenses from the actual expense:

$4,500 - $5,000 = -$500.

Since the actual expense is lower than budgeted, it's a Favorable variance (F).

The spending variance related to shipping expenses? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)

Remember, these are just illustrative values. Adjust the numbers based on your specific budgeted and actual amounts for each category.

Answer 2

1. Spending variance for advertising is 10,000 U.

2. Spending variance for Sales salaries and commissions is 63,000 F.

3. Spending variance for shipping expenses is 1,000 U.

Spending variance refers to the difference between budgeted or expected spending and actual spending which is often used to assess financial performance.

Spending variance for advertising:

= Flexible - Actual

= 210,000 - 220,000

= 10,000 U

Spending variance for Sales salaries and commissions:

= Flexible - Actual

= [120,000 + (13*31,000)] - 460,000

= 523,000 - 460,000

= 63,000 F

Spending variance for shipping expenses:

= (4*31,000) - 125,000

= 124,000 - 125,000

= 1,000 U

Note: The full question is attached below.