Dinham Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 5,400 tenant-days, but its actual level of activity was 5,450 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March: Data used in budgeting: Fixed element per month Variable element per tenant-day Revenue - $ 35.90 Wages and salaries $ 2,600 $ 9.30 Food and supplies 1,800 15.80 Facility expenses 8,200 4.80 Administrative expenses 6,700 0.60 Total expenses $ 19,300 $ 30.50 Actual results for March: Revenue $ 172,325 Wages and salaries $ 28,730 Food and supplies $ 87,530 Facility expenses $ 34,975 Administrative expenses $ 7,113 The revenue variance for March would be closest to: Multiple Choice $21,535 U $21,535 F $23,330 F $23,330 U
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Dinham Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During March, the kennel budgeted for 5,400 tenant-days, but its actual level of activity was 5,450 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March:
Data used in budgeting:
| Fixed element per month | Variable element per tenant-day | ||||
| Revenue | - | $ | 35.90 | ||
| Wages and salaries | $ | 2,600 | $ | 9.30 | |
| Food and supplies | 1,800 | 15.80 | |||
| Facility expenses | 8,200 | 4.80 | |||
| Administrative expenses | 6,700 | 0.60 | |||
| Total expenses | $ | 19,300 | $ | 30.50 | |
Actual results for March:
| Revenue | $ | 172,325 | |
| Wages and salaries | $ | 28,730 | |
| Food and supplies | $ | 87,530 | |
| Facility expenses | $ | 34,975 | |
| Administrative expenses | $ | 7,113 | |
The revenue variance for March would be closest to:
-
$21,535 U
-
$21,535 F
-
$23,330 F
-
$23,330 U
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