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Standahl Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $40,990 per month plus $2,789 per flight plus $18 per passenger. The company expected its activity in August to be 96 flights and 308 passengers, but the actual activity was 99 flights and 311 passengers. The actual cost for plane operating costs in August was $262,690. The plane operating costs in the planning budget for August would be closest to:

Sagot :

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Answer:

$314,278

Explanation:

Cost in flexible budget = $40,990 + ($2,789*96) + ($18*308)

Cost in flexible budget = $40,990 + $267,744 + $5,544

Cost in flexible budget = $314,278

The operating costs in the planning budget for August would be

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