Vanderhyde 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 May, the kennel budgeted for 3, 300 tenant-days, but its actual level of activity was 3, 340 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: The administrative expenses in the planning budget for May would be closest to:
A)$7, 792
B)$7, 886
C)$8, 136
D)$8, 120

Question

Vanderhyde 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 May, the kennel budgeted for 3, 300 tenant-days, but its actual level of activity was 3, 340 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting:  Actual results for May:  The administrative expenses in the planning budget for May would be closest to:
A)$7, 792 
B)$7, 886 
C)$8, 136 
D)$8, 120

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $6, 800 + ($0.40 × 3, 300)= $8, 120

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