Mongelli Family Inn is a bed and breakfast establishment in a
converted 100-year-old mansion. The Inn's guests appreciate its
gourmet breakfasts and individually decorated rooms. The Inn's
overhead budget for the most recent month appears below:
Activity level | 90 guests |
Variable overhead costs: | |
Supplies | $234 |
Laundry | 315 |
Fixed overhead costs: | |
Utilities | 220 |
Salaries and wages | 4,290 |
Depreciation | 2,680 |
Total overhead cost | $7,739 |
The Inn's variable overhead costs are driven by the number of
guests.
Assuming that the activity levels of 90 guests and 99 guests are
within the same relevant range and rounding to the nearest dollar,
what would be the total budgeted overhead cost for a month if the
activity level is 99 guests?
Multiple Choice
$7,794.
$61,541.
$8,513.
$7,739.
Total budgeted overhead cost
= Variable + Fixed
= [(234+315)*99] + 220+4290+2680
= 54,351 + 7,190
= 61,541
Option B is the answer
Variable + Fixed
=(234/90*99)+(315/90*99)+220+4290+2680
=7793.9
=7794
Answer is A
Mongelli Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's...
Papenfuss Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below: Activity level 62 guests Variable overhead costs: Supplies $ 83.70 Laundry 409.20 Fixed overhead costs: Utilities 540.00 Salaries and wages 5,140.00 Depreciation 2,650.00 Total overhead cost $ 8,822.90 The Inn's variable overhead costs are driven by the number of guests. What would be the...
May Corporation, a merchandising firm, has budgeted sales as follows for the third quarter of the year: July$99,000 August$72,000 September$86,400 Cost of goods sold is equal to 65% of sales. The company wants to maintain a monthly ending inventory equal to 110% of the Cost of Goods Sold for the following month. The inventory on June 30 is less than this ideal since it is only $68,185. The company is now preparing a Merchandise Purchases Budget. The budgeted purchases...