d be true? month. When the actual level of activity is less than budgeted, which

Question

d be true? month. When the actual level of activity is less than budgeted, which of the followi A. Variable costs would show favorable variances. Variable costs would show unfavorable variances. COFixed costs would show favorable variances. Fixed costs would show unfavorable variances. Zenon Kennel uses tenant-days as its measure of activity; an animal housed in the kenn counted as one tenant-day. During July, the kennel budgeted for 3,300 tenant-days, but activity was 3,260 tenant-days. The kennel has provided the following data concerningt budgeting and its actual results for July: rone day is al level of ulas used i Data used in budgeting: Variable element per tenant-day $27.60 Fixed element per month Revenue Wages and salaries. $ 5.10 3.400 1,000 8,600 Food and supplies... 8.20 4.90 Facility expenses Administrative expenses... 0.40 $18.60 Total expenses Actual results for July: Revenue.... Wages and salaries... Food and supplies... Facility expenses Administrative expenses... $19,796 $27,262 $25,004 $8,704 The food and supplies in the flexible budget for July would be closest to: $27,732 . $27,597 $28,060 $26,932

Explanation / Answer

Solution:- A. 27,732

Explanation:-

Cost = Fixed cost + (Variable cost per unit * q)

= $1,000 + ($8.20 * 3,260) = $27,732

Please Rate or comment if you have any doubt regarding this solution.

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