Bard Hotel bases its budgets on guest-days. The hotel\'s static budget for Janua

Question

Bard Hotel bases its budgets on guest-days. The hotel's static budget for January appears below:

The total fixed cost at the activity level of 10,600 guest-days per month should be:

$210,240

$232,140

$116,160

$128,260

Budgeted number of guest-days 9,600 Budgeted variable costs:   Supplies (@ $7.50 per guest-day)        $72,000   Laundry (@ $2.30 per guest-day)          22,080 Total variable cost 94,080 Budgeted fixed costs:   Wages and salaries 95,040   Occupancy costs      21,120 Total fixed cost    116,160 Total cost $210,240

Explanation / Answer

Answer - C ($116,160)

The total fixed cost doesn't change with the activity level and will be constant

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