Arkin 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, the kennel budgeted for 3,100 tenant-days, but its actual level of activity was 3,070 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:

Data used in budgeting:
Actual results for May:
-The administrative expenses in the planning budget for May would be closest to:
A)$7,228
B)$7,016
C)$6,948
D)$7,240

Question

Arkin 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, the kennel budgeted for 3,100 tenant-days, but its actual level of activity was 3,070 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:

Data used in budgeting:

Actual results for May:

-The administrative expenses in the planning budget for May would be closest to:

Data used in budgeting:
 Actual results for May: 
-The administrative expenses in the planning budget for May would be closest to:
A)$7,228 
B)$7,016 
C)$6,948 
D)$7,240

Quizplus · Accepted Answer

Cost = Fixed cost per unit + Variable cost per unit F1F1F1S1F1F1F10 q
= $6,000 + $0.40 F1F1F1S1F1F1F10 3,100 = $7,240

Arkin Kennel Uses Tenant-Days as Its Measure of Activity; an Animal