Question

Tolentino 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 November, the kennel budgeted for 3,500 tenant-days, but its actual level of activity was 3,540 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for November: Data used in budgeting Fixed Variable element per element per month tenant-day $30.40 Revenue T Wages and salaries Expendables Facility expenses Administrative expenses Total expenses $2,300 800 7,800 6.400 $17,300 $6.50 10.80 3.30 0.50 $21.10 Actual results for November Revenue Wages and salaries Expendables Facility expenses Administrative expenses $102.416 $24.750 $40,388 $15,340 $7.215 The net operating Income In the flexible budget for November would be closest to: $15,250 $32,922 $32.550 $15,622

Answer 1

Answers Page No ① Niets operating income the flexible budget for Movember Revenue = Aclucl level of acbivily x Revenue veniable element S per tenant-day E 31540. tenant- deya x $ 30:40 = $107616 Coages & salaries expenses = $2300 + (3540 x $6.50) = 2300 + 23010 = $ 25310 Expendables = 4800 + [ 3540 tenant days x ¢ 10.80] = 500 + 38232 $39032 facilily expenses - $4800 + [ 3540 tenant days * $ 3.30] = 7800 7 11682 = $ 19482 Administrative expenses = $ 5400 + (3540 tenant days x80050] = 6400 + 1990 2 8170

③ Page No Total expenses = 25310 + 39032 + 19482 +8178 = $91994 Niet operating income - Revenue – total expenses = 107616 -91994 = $15602 Net operating income in the flexible budget for november = $15,622 Amount # 107616 :: The option is correct answer Alexible budget Particular Revenue Expenseses: wages & salaries Expendables facility expenses Administrative expenses Totul expenses Net operating income ( 25310) ($ 39032) $19482) $8140) (491994 ) $ 15,6 2 2