Question

Mongelli Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's...

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.

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Answer #1

Total budgeted overhead cost

= Variable + Fixed

= [(234+315)*99] + 220+4290+2680

= 54,351 + 7,190

= 61,541

Option B is the answer

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Answer #2

Variable + Fixed

=(234/90*99)+(315/90*99)+220+4290+2680

=7793.9

=7794


Answer is A

answered by: Jessica426
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