Ramkissoon Midwifery's cost formula for its wages and salaries is $2,060 per month plus $442 per birth.For the month of July, the company planned for activity of 117 births, but the actual level of activity was 114 births.The actual wages and salaries for the month was $54,500.The spending variance for wages and salaries in July would be closest to:

A) $726 U
B) $2,052 F
C) $2,052 U
D) $726 F

First, we need to calculate the total cost that Ramkissoon Midwifery should have incurred in July based on their cost formula:

Cost = $2,060 + ($442 x 114) = $53,588

Next, we need to calculate the spending variance, which is the difference between the actual wages and salaries and the budgeted cost:

Spending Variance = Actual Cost - Budgeted Cost
Spending Variance = $54,500 - $53,588
Spending Variance = $912

Since the actual cost is higher than the budgeted cost, the spending variance is unfavorable or unfavorable. The option that represents the closest amount to this answer is C, $2,052 U (unfavorable).

Since the actual expense is greater than the flexible budget, the variance is unfavorable (U)