Alyeski Tours operates day tours or 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 82 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Cost per Cost per Passenger $ 3.00 Fixed Cost per Month Vessel operating costs $ 6,300 Cruise $ 475.00 $ 2,700 Administrative costs $ 5,700 $ 3,300 $ 31.00 $ 1.50 Advertising Insurance For example, vessel operating costs should be $6,300 per month plus $475.00 per cruise plus $3.00 per passenger. The company's sales should average $31.00 per passenger. In July, the company provided 54 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours Flexible Budget For the Month Ended July 31 Revenue Expenses: Vessel operating costs Advertising Administrative costs Insurance
Alyeski Tours operates day tours or 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 82 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Cost per Cost per Passenger $ 3.00 Fixed Cost per Month Vessel operating costs $ 6,300 Cruise $ 475.00 $ 2,700 Administrative costs $ 5,700 $ 3,300 $ 31.00 $ 1.50 Advertising Insurance For example, vessel operating costs should be $6,300 per month plus $475.00 per cruise plus $3.00 per passenger. The company's sales should average $31.00 per passenger. In July, the company provided 54 cruises for a total of 3,150 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours Flexible Budget For the Month Ended July 31 Revenue Expenses: Vessel operating costs Advertising Administrative costs Insurance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Alyeski Tours operates day tours or 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 82 passengers can
be accommodated on the tour boat. Data concerning the company's cost formulas appear below:
Cost per Cost per
Passenger
$ 3.00
Fixed Cost
per Month
Vessel operating costs
$ 6,300
Cruise
$ 475.00
$ 2,700
Administrative costs
$ 5,700
$ 3,300
$ 31.00
$ 1.50
Advertising
Insurance
For example, vessel operating costs should be $6,300 per month plus $475.00 per cruise plus $3.00 per passenger. The company's
sales should average $31.00 per passenger. In July, the company provided 54 cruises for a total of 3,150 passengers.
Required:
Prepare the company's flexible budget for July.
Alyeski Tours
Flexible Budget
For the Month Ended July 31
Revenue
Expenses:
Vessel operating costs
Advertising
Administrative costs
Insurance
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