18. Sullivan Family Inn is a bed and breakfast establishment in a converted 100-

Question

18. Sullivan Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below 57 guests Activity level Variable overhead costs: Supplies S 148.20 Laundry Fixed overhead costs 216.60 170.00 4,310.00 Utilities Salaries and wages Depreciation 2.340 00 Total overhead cost S7,184.80 The Inn's variable overhead costs are driven by the number of guests What would be the total budgeted overhead cost for a month if the activity level is 53 guests? A. $7,159.20 B. $6,680.60 C. $7,184.80 D. $26,154.40 Variable cost per guest for supplies = $148.20+ 57 guests-$2.60 per guest Variable cost per guest for laundry = $216.60+ 57 guests-$3.80 per guest

Explanation / Answer

The Answer is "A".

Solution :-

Total Budgeted Overhead Cost :-

Particulars Amount ($) Variable Overhead Cost :- Supplies ($2.60 * 53) 137.8 Laundry ($3.80 * 53) 201.4 Fixed Overhead Cost :- Utilities 170 Salaries and Wages 4310 Depreciation 2340 Total Budgeted Overhead Cost 7159.20

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