Rhed 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 3,700 tenant-days, but its actual level of activity was 3,650 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting:
Actual results for December:
The wages and salaries in the planning budget for December would be closest to:
A) $30,575
B) $30,994
C) $30,305
D) $30,690

Question

Rhed 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 3,700 tenant-days, but its actual level of activity was 3,650 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting:
 Actual results for December:
 The wages and salaries in the planning budget for December would be closest to:
A) $30,575 
B) $30,994 
C) $30,305 
D) $30,690

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $2,200 + ($7.70 × 3,700) = $30,690

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