Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two drivers-the number of cruises and the number of passengers-that it uses in its budgeting and performance reports. The com publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 86 passen be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Vessel operating costs Advertising Administrative costs Insurance Fixed Cost per Cost per Month Cost per Passenger $ 3.30 $ 6,400 $ 2,500 Cruise $ 472.00 $ 5,100 $ 3,400 $ 31.00 $ 1.50 For example, vessel operating costs should be $6,400 per month plus $472.00 per cruise plus $3.30 per passenger. The com sales should average $34.00 per passenger. In July, the company provided 54 cruises for a total of 3,050 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours Flexible Budget For the Month Ended July 31 Actual cruises 52 Revenue Expenses: Vessel operating costs Advertising Administrative costs Insurance Total expense 0
Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two drivers-the number of cruises and the number of passengers-that it uses in its budgeting and performance reports. The com publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 86 passen be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Vessel operating costs Advertising Administrative costs Insurance Fixed Cost per Cost per Month Cost per Passenger $ 3.30 $ 6,400 $ 2,500 Cruise $ 472.00 $ 5,100 $ 3,400 $ 31.00 $ 1.50 For example, vessel operating costs should be $6,400 per month plus $472.00 per cruise plus $3.30 per passenger. The com sales should average $34.00 per passenger. In July, the company provided 54 cruises for a total of 3,050 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours Flexible Budget For the Month Ended July 31 Actual cruises 52 Revenue Expenses: Vessel operating costs Advertising Administrative costs Insurance Total expense 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost
drivers-the number of cruises and the number of passengers--that it uses in its budgeting and performance reports. The company
publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 86 passengers can
be accommodated on the tour boat. Data concerning the company's cost formulas appear below:
Vessel operating costs
Advertising
Administrative costs
Insurance
Fixed Cost per Cost per
Month
$ 6,400
$ 2,500
Cruise
$ 472.00
Cost per
Passenger
$ 3.30
$ 5,100
$ 3,400
$ 31.00
$ 1.50
For example, vessel operating costs should be $6,400 per month plus $472.00 per cruise plus $3.30 per passenger. The company's
sales should average $34.00 per passenger. In July, the company provided 54 cruises for a total of 3,050 passengers.
Required:
Prepare the company's flexible budget for July.
Alyeski Tours
Flexible Budget
For the Month Ended July 31
Actual cruises
52
Revenue
Expenses:
Vessel operating costs
Advertising
Administrative costs
Insurance
Total expense
0
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