Gandrud 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 June, the kennel budgeted for 2, 600 tenant-days, but its actual level of activity was 2, 580 tenant-days.The kennel has provided the following data concerning the formulas to be used in its budgeting: The facility expenses in the flexible budget for June would be closest to:
A)$16, 308
B)$16, 360
C)$16, 223
D)$15, 974

Question

Gandrud 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 June, the kennel budgeted for 2, 600 tenant-days, but its actual level of activity was 2, 580 tenant-days.The kennel has provided the following data concerning the formulas to be used in its budgeting:  The facility expenses in the flexible budget for June would be closest to:
A)$16, 308 
B)$16, 360 
C)$16, 223 
D)$15, 974

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $9, 600 + ($2.60 × 2, 580)= $16, 308

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