Zenon 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 July, the kennel budgeted for 3,300 tenant-days, but its actual level of activity was 3,260 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for July:Data used in budgeting: Fixed element per month Variable element per tenant-day Revenue − $ 27.60 Wages and salaries $ 3,400 $ 5.10 Food and supplies 1,000 8.20 Facility expenses 8,600 4.90 Administrative expenses 7,000 0.40 Total expenses $ 20,000 $ 18.60 Actual results for July: Revenue $ 87,446 Wages and salaries $ 19,556 Food and supplies $ 27,262 Facility expenses $ 24,004 Administrative expenses $ 8,704 The facility expenses in the flexible budget for July would be closest to: $25,311 $24,770 $24,701 $24,574
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.
Zenon 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 July, the kennel budgeted for 3,300 tenant-days, but its actual level of activity was 3,260 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for July:
Data used in budgeting:
| Fixed element per month | Variable element per tenant-day | |||||
| Revenue | − | $ | 27.60 | |||
| Wages and salaries | $ | 3,400 | $ | 5.10 | ||
| Food and supplies | 1,000 | 8.20 | ||||
| Facility expenses | 8,600 | 4.90 | ||||
| Administrative expenses | 7,000 | 0.40 | ||||
| Total expenses | $ | 20,000 | $ | 18.60 | ||
Actual results for July:
| Revenue | $ | 87,446 | |
| Wages and salaries | $ | 19,556 | |
| Food and supplies | $ | 27,262 | |
| Facility expenses | $ | 24,004 | |
| Administrative expenses | $ | 8,704 | |
The facility expenses in the flexible budget for July would be closest to:
$25,311
$24,770
$24,701
$24,574
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