Rising Framing's cost formula for its supplies cost is $2,210 per month plus $10 per frame. For the month of January, the company planned for activity of 710 frames, but the actual level of activity was 705 frames. The actual supplies cost for the month was $9,500. The supplies cost in the flexible budget for January would be closest to:
A) $9,260
B) $9,244
C) $9,500
D) $9,310

Question

Quizplus · Accepted Answer

The flexible budget for January would be $9,260. The cost formula is $2,210 per month plus $10 per frame. For 710 frames, the budgeted cost would be $2,210 + (710 x $10) = $9,260.

Rising Framing's Cost Formula for Its Supplies Cost Is $2,210