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Friendly Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms.
Friendly Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below:
Activity level................................. | 75 guests | |
Variable overhead costs: | ||
Supplies...................................... | $ 312 | |
Laundry...................................... | 360 | |
Fixed overhead costs: | ||
Utilities....................................... | 220 | |
Salaries and wages..................... | 4,290 | |
Depreciation............................... | 2,680 | |
Total overhead cost....................... | $7,862 |
The Inn's variable overhead costs are driven by the number of guests.
What would be the total budgeted overhead cost for a month if the activity level is 78 guests? Assume that the activity levels of 75 guests and 88 guests are within the same relevant range
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