Question
1a. Tulip Midwifery's cost formula for its wages and salaries is $3,320 per month plus $465 per birth. For the month of January, the company
1a.
Tulip Midwifery's cost formula for its wages and salaries is $3,320 per month plus $465 per birth. For the month of January, the company planned for activity of 150 births, but the actual level of activity was 165 births. The actual wages and salaries for the month was $80,533. The wages and salaries in the flexible budget for January would be closest to:
A:$80,533
B:$73,070
C:$80,045
D:80,126
1b.
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 2,760 tenant-days, but its actual level of activity was 2,740 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:
Fixed element per month | Variable element per tenant-day | |||||
Revenue | $ | 40.30 | ||||
Wages and salaries | $ | 3,520 | $ | 8.10 | ||
Food and supplies | 1,335 | 15.60 | ||||
Facility expenses | 10,700 | 3.40 | ||||
Administrative expenses | 8,100 | 1.10 | ||||
Total expenses | $ | 23,655 | $ | 28.20 | ||
The net operating income in the flexible budget for June would be closest to:
A:$9,757
B:$12,449
C:$9,499
D:$12,230
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