Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost drivers--the number of

image text in transcribed
image text in transcribed
Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost drivers--the number of cruises and the number of passengers-that it uses in its budgeting and performance reports. The company publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 82 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Vessel operating costs Advertising Administrative costs Insurance Fixed Cost per Month cost per Cruise $ 6,300 $ 477.00 $ 2,100 $ 5,100 $ 30.00 $ 3,300 For example, vessel operating costs should be $6,300 per month plus $477.00 per cruise plus $3.40 per passenger. The company's sales should average $32.00 per passenger. In July, the company provided 57 cruises for a total of 3,050 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost drivers--the number of cruises and the number of passengers-that it uses in its budgeting and performance reports. The company publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 82 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost per Month Cost per Cruise Cost per Passenger Vessel operating costs $ 6,300 $ 477.00 $ 3.40 Advertising $ 2,100 Administrative costs $ 5,100 $ 30.00 $1.50 Insurance $3,300 For example, vessel operating costs should be $6,300 per month plus $477.00 per cruise plus $3.40 per passenger. The company's sales should average $32,00 per passenger. In July, the company provided 57 cruises for a total of 3,050 passengers Required: Prepare the company's flexible budget for July

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

ISE Introductory Financial Accounting For Business

Authors: Thomas P. Edmonds, Christopher Edmonds

2nd Edition

1260575306, 9781260575309

More Books

Students also viewed these Accounting questions

Question

What methods do communication scholars use to conduct research?

Answered: 1 week ago