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Bustillo Company operates sight-seeing buses. Management has identified two cost drivers-the number of buses in operation and the number of passengers served -that it uses
Bustillo Company operates sight-seeing buses. Management has identified two cost drivers-the number of buses in operation and the number of passengers served -that it uses in its budgeting and performance reports. Data concerning the company's cost formulas appear below: Cost per Bus $ 476 Cost per Passenger Vehicle operating costs Advertising Administrative costs Insurance Fixed Cost per month $ 6,800 $ 2.500 $ 5.300 $ 3,900 $ 38 $ 1.5 For example, vehicle operating costs should be $6.800 per month plus $476 per bus plus $3 per passenger. The company's sales revenue should average $30 per passenger. In July, the company operated 50 buses and served a total of 3,150 passengers. How much is the company's flexible budget operating income for July? Multiple Choice o $30,600 $58,375 $36,125 O $54,450
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