Lutts 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 November, the kennel budgeted for 3,800 tenant-days, but its actual level of activity was 3,850 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:
-The net operating income in the planning budget for November would be closest to:
A) $12,720
B) $9,648
C) $9,904
D) $13,115

Question

Lutts 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 November, the kennel budgeted for 3,800 tenant-days, but its actual level of activity was 3,850 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: 
-The net operating income in the planning budget for November would be closest to:
A) $12,720 
B) $9,648 
C) $9,904 
D) $13,115

Quizplus · Accepted Answer

The net operating income in the planning budget for November would be closest to $12,720. This is because the net operating income is calculated by subtracting the total operating expenses from the total operating revenue. In this case, the total operating revenue is $22,368 and the total operating expenses are $9,648. Therefore, the net operating income is $22,368 - $9,648 = $12,720.

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