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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 85 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost per Month Cost per Cruise Cost per Passenger $ 477.00 $ 3.10 Vessel operating costs $6,000 Advertising $ 2,000 Administrative costs $5,900 $3,600 Insurance $ 30.00 $1.50 For example, vessel operating costs should be $6,000 per month plus $477.00 per cruise plus $3.10 per passenger. The company's sales should average $33.00 per passenger. In July, the company provided 56 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July.

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 85 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost per Month Cost per Cruise Cost per Passenger $ 477.00 $ 3.10 Vessel operating costs $6,000 Advertising $ 2,000 Administrative costs $5,900 $3,600 Insurance $ 30.00 $1.50 For example, vessel operating costs should be $6,000 per month plus $477.00 per cruise plus $3.10 per passenger. The company's sales should average $33.00 per passenger. In July, the company provided 56 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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 85 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost per Month Cost per Cruise Cost per Passenger $6,000 $ 477.00 $ 3.10 $ 2,000 Administrative costs $5,900 $3,600 Vessel operating costs Advertising Insurance $ 30.00 $1.50 For example, vessel operating costs should be $6,000 per month plus $477.00 per cruise plus $3.10 per passenger. The company's sales should average $33.00 per passenger. In July, the company provided 56 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July.
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 85 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Fixed Cost per Month Cost per Cruise Cost per Passenger $6,000 $ 477.00 $ 3.10 $ 2,000 Administrative costs $5,900 $3,600 Vessel operating costs Advertising Insurance $ 30.00 $1.50 For example, vessel operating costs should be $6,000 per month plus $477.00 per cruise plus $3.10 per passenger. The company's sales should average $33.00 per passenger. In July, the company provided 56 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July.
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