Question
Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable
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Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below: |
| Fixed Element per Month | Variable Element per Customer Served | Actual Total for May | ||||
| Revenue | $ | 5,800 | $ | 217,000 | ||
| Employee salaries and wages | $ | 57,000 | $ | 1,800 | $ | 128,100 |
| Travel expenses | $ | 950 | $ | 35,300 | ||
| Other expenses | $ | 36,000 | $ | 34,400 | ||
| When preparing its planning budget the company estimated that it would serve 35 customers per month; however, during May the company actually served 40 customers. |
1.
Required information
| Required: | |
| 1. | What amount of revenue would be included in Adgers flexible budget for May? |
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eBook & Resources
eBook: Prepare a flexible budget.eBook: Prepare a report showing activity variances.eBook: Prepare a report showing revenue and spending variances.
Check my work
Required information
| 2. | What amount of employee salaries and wages would be included in Adgers flexible budget for May? |
| |||||||||||||||
eBook & Resources
eBook: Prepare a flexible budget.eBook: Prepare a report showing activity variances.eBook: Prepare a report showing revenue and spending variances.
Check my work
3.
Required information
| 3. | What amount of travel expenses would be included in Adgers flexible budget for May?
| |||||||||||||
eBook & Resources
eBook: Prepare a flexible budget.eBook: Prepare a report showing activity variances.eBook: Prepare a report showing revenue and spending variances.
Check my work
4.
Required information
| 4. | What amount of other expenses would be included in Adgers flexible budget for May?
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| 5. | What net operating income would appear in Adgers flexible budget for May? |
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