Q3

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Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identied two cost driversthe number of cruises and the number of passengersthat 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 81 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost Cost per Cost per per Month Cruise Passenger Vessel operating costs $ 6,300 $ 478.00 $ 3.30 Advertising 5 3,000 Administrative costs $ 5,900 $ 39.00 $ 1.50 Insurance 5 3,500 For example, vessel operating costs should be $6,300 per month plus $478.00 per cruise plus $3.30 per passenger. The company's sales should average $31.00 per passenger. In July, the company provided 53 cruises for a total of 3,050 passengers. Required: Prepare the company's flexible budget for July. _ _ m = Net operating' Income