Kari 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 3,200 tenant-days,but its actual level of activity was 3,230 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:

Question

Kari 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 3,200 tenant-days,but its actual level of activity was 3,230 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:

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $7,000 + ($0.30 × 3,200)= $7,960

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