Question

Tulip Midwifery's cost formula for its wages and salaries is $3,390 per month plus $480 per birth. For the month of January, the company planned for activity of 156 births, but the actual level of activity was 163 births. The actual wages and salaries for the month was $82,141. The wages and salaries in the flexible budget for January would be closest to:______.a. $82,141.b. $108,711.
c. $109,151.
d. $108,630.
e. $104,202.

Answer 1

Answer:

$81,630

Explanation:

Cost formula for the wages and salaries = $3,390 per Month + $480 per Birth

Where;

Planned number of activity = 156 births

Actual level of activity = 163 births

Therefore, the wages and salaries in the flexible budget for January is calculated below;

= ($3,390 * 1) + ($480 * 163)

= $3,390 + $78,240

= $81,630

Answer 2

Answer:

Total cost= $81,630

Explanation:

Giving the following information:

Tulip Midwifery's cost formula for its wages and salaries is $3,390 per month plus $480 per birth. The actual level of activity was 163 births.

The flexible budget will show the standard costs and actual activity.

Flexible budget:

Total cost= 3,390 + 480*163

Total cost= $81,630