Waec Model Questions Vol1 2017 Financial Accounting Question 3

A local government department prepared its original budget for the fiscal year as follows (amounts in thousands of Naira): Personnel expenditure.............. 12,000 Office supplies..................... 3,000 Maintenance......................... 4,500 Capital outlay (new equipment)...... 5,000 Transfer payments to other departments 2,000 During the year the actual expenditures were: Personnel.......................... 13,200 Office supplies..................... 2,700 Maintenance......................... 5,400 Capital outlay...................... 4,800 Transfer payments.................. 2,200 Depreciation of existing equipment (not budgeted) 600 In addition, the department received a supplementary grant of 1,500 (not in the original budget) which was used entirely for maintenance. Calculate the overall budget variance (actual net cash outflow minus original budget) and express it as a percentage of the original budget. State whether the variance is a surplus or a deficit.