Kawamura Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,320 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: Fixed Element per Month Variable element per tenant-day Revenue $ 0 $37.70 Wages and salaries $ 3,000 $ 6.10 Food and supplies 800 13.40 Facility expenses 9,800 4.70 Administrative expenses 7,100 0.20 Total expenses $20,700 $24.40 The net operating income in the planning budget for December would be closest to: Multiple Choice A. $10,156 B. $9,890 C. $7,309 D. $7,184

Kawamura Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,320 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: Fixed Element per Month Variable element per tenant-day Revenue $ 0 $37.70 Wages and salaries $ 3,000 $ 6.10 Food and supplies 800 13.40 Facility expenses 9,800 4.70 Administrative expenses 7,100 0.20 Total expenses $20,700 $24.40 The net operating income in the planning budget for December would be closest to: Multiple Choice A. $10,156 B. $9,890 C. $7,309 D. $7,184

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 38P: Friendly Bank is attempting to determine the cost behavior of its small business lending operations....

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	Fixed Element per Month	Variable element per tenant-day
Revenue	$ 0	$37.70
Wages and salaries	$ 3,000	$ 6.10
Food and supplies	800	13.40
Facility expenses	9,800	4.70
Administrative expenses	7,100	0.20
Total expenses	$20,700	$24.40

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Gandrud Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During June, the kennel budgeted for 2,660 tenant-days, but its actual level of activity was 2,640 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month Variable element per tenant-day Revenue − $ 38.30 Wages and salaries $ 3,455 $ 7.60 Food and supplies 1,650 14.60 Facility expenses 11,800 2.90 Administrative expenses 10,250 0.60 Total expenses $ 27,155 $ 25.70 The food and supplies in the flexible budget for June would be closest to: $39,867 $40,443 $40,486 $40,194
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Bernes Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During October, the kennel budgeted for 2,700 tenant-days, but its actual level of activity was 2,720 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month Variable element per tenant-day Revenue $ 0 $ 30.80 Wages and salaries $ 3,300 $ 6.10 Food and supplies 600 10.10 Facility expenses 8,800 3.60 Administrative expenses 7,600 0.10 Total expenses $ 20,300 $ 19.90 The activity variance for net operating income in October would be closest to: Multiple Choice A. $2,328 F B. $218 U C. $218 F D. $2,328 U
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