Courington Detailing's cost formula for its materials and supplies is $2,420 per month plus $9 per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the actual level of activity was 33 vehicles. The actual materials and supplies for the month was $2,840.
Why such a great disparity between the planned and actual level of activity from 63 to 33 vehicles - should these be closer together?
Please keep as is.
-The materials and supplies in the flexible budget for August would be closest to:
A) $1,565
B) $2,717
C) $2,987
D) $2,840

Question

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $2,420 + ($9 × 33) = $2,717

Courington Detailing's Cost Formula for Its Materials and Supplies Is