Question

Given planning budget revenue of $284,000, actual revenue of $275,000, and flexible budget revenue of $290,000, there is a(n)
[blank] activity variance. (Enter either favorable or unfavorable.)

Answer 1

To determine the activity variance, we need to compare the flexible budget revenue to the actual revenue.

1. **Flexible Budget Revenue:** $290,000
2. **Actual Revenue:** $275,000

Now, we calculate the variance:

\[ \text{Activity Variance} = \text{Flexible Budget Revenue} - \text{Actual Revenue} \]

\[ \text{Activity Variance} = 290,000 - 275,000 = 15,000 \]

Since the flexible budget revenue is higher than the actual revenue, the variance is unfavorable.

Thus, the answer is **unfavorable**.