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Adger Corporation is a service company that measures its output based on the number of customers...

Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below:

Fixed Element
per Month
Variable Element per Customer Served Actual Total
for May
Revenue $ 5,900 $ 216,500
Employee salaries and wages $ 66,000 $ 1,300 $ 116,200
Travel expenses $ 580 $ 19,700
Other expenses $ 45,000 $ 42,500

When preparing its planning budget the company estimated that it would serve 35 customers per month; however, during May the company actually served 40 customers.

Foundational 9-11

11. What amount of employee salaries and wages would be included in Adger’s planning budget for May?

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Answer #1
11
Employee salaries and wages:
Variable element per customer served 1300
Planned activity 35
Variable portion of the amount 45500
Fixed element per month 66000
Amount in planning budget 111500
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