During April, Cheatam Corporation budgeted for 27,000 customers, but actually se

Question

During April, Cheatam Corporation budgeted for 27,000 customers, but actually served 25,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:

Prepare the company's flexible budget for April based on the actual level of activity for the month.

Actual customers served ________

Revenue_______

Expenses:

Wages and salaries _______

Supplies _______

Insurance _______
Misc. Expense________

Total expense _________

Net operating income _______

During April, Cheatam Corporation budgeted for 27,000 customers, but actually served 25,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:

Explanation / Answer

Actual customer served 25000 Revenue 4.82*25000 120500 expenses wages and salaries [(1.73*25000)+35200] 78450 supplies .63*25000 15750 Insurance 12200 12200 Misc.expense [(25000*.13)+5200] 8450 Total expense (114850) net operating income 5650

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