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: The wages and salaries in the planning budget for December would be closest to:
A) $17,787
B) $17,942
C) $17,152
D) $17,030

Question

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:  The wages and salaries in the planning budget for December would be closest to:
A) $17,787 
B) $17,942 
C) $17,152 
D) $17,030

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $3,000 + ($6.10 × 2,300) = $17,030

Kawamura Kennel Uses Tenant-Days as Its Measure of Activity; an Animal