Kari 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, 200 tenant-days, but its actual level of activity was 3, 230 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 facility expenses in the flexible budget for May would be closest to:
A)$20, 394
B)$20, 778
C)$19, 700
D)$19, 805

Question

Kari 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, 200 tenant-days, but its actual level of activity was 3, 230 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 facility expenses in the flexible budget for May would be closest to:
A)$20, 394 
B)$20, 778 
C)$19, 700 
D)$19, 805

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $8, 500 + ($3.50 × 3, 230)= $19, 805

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