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Galante 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 May,
Galante 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 May, Kennel budgeted for 5,400 tenant-days, but its actual level of activity was 5,420 tenant-days. Kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: |
Data used in budgeting:
Fixed element per month | Variable element per tenant-day | |
Revenue | $31.90 | |
Wages and salaries | $4,400 | $7.90 |
Food and supplies | 500 | 12.70 |
Facility expenses | 8,800 | 4.90 |
Administrative expenses | 7,800 | 0.20 |
Total expenses | $21,500 | $25.70 |
Actual results for May:
Revenue | $109,180 |
Wages and salaries | $23,640 |
Food and supplies | $36,804 |
Facility expenses | $19,390 |
Administrative expenses | $9,168 |
The net operating income in the flexible budget for May would be closest to:
$12,104
$20,084
$11,980
$20,178
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