Exercise 9-5 (Algo) Prepare a Flexible Budget with More Than One Cost Driver (LO9-5) 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 84 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 cost per Month Passenger $ 3.10 Cruise $ 6,100 $475.00 $ 2,800 $5,400 $ 32.00 $1.50 $ 3,900 For example, vessel operating costs should be $6,100 per month plus $475.00 per cruise plus $3.10 per passenger. The company's sales should average $32.00 per passenger. In July, the company provided 51 cruises for a total of 3,000 passengers. Required: Prepare the company's flexible budget for July
Exercise 9-5 (Algo) Prepare a Flexible Budget with More Than One Cost Driver (LO9-5) 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 84 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 cost per Month Passenger $ 3.10 Cruise $ 6,100 $475.00 $ 2,800 $5,400 $ 32.00 $1.50 $ 3,900 For example, vessel operating costs should be $6,100 per month plus $475.00 per cruise plus $3.10 per passenger. The company's sales should average $32.00 per passenger. In July, the company provided 51 cruises for a total of 3,000 passengers. Required: Prepare the company's flexible budget for July
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text: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
Total expense
Net operating income
$
GA
0
0
![Exercise 9-5 (Algo) Prepare a Flexible Budget with More Than One Cost Driver [LO9-5]
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 84 passengers can
be accommodated on the tour boat. Data concerning the company's cost formulas appear below.
Vessel operating costs
Advertising
Administrative costa
Insurance
Fixed
Cost per Cost per cost per
Month
Cruise
$ 6,100 $475.00
Passenger
$ 3.10
$ 2,800
$ 32.00
$1.50
$5,400
$3,900
For example, vessel operating costs should be $6,100 per month plus $475.00 per cruise plus $3.10 per passenger. The company's
sales should average $32.00 per passenger. In July, the company provided 51 cruises for a total of 3,000 passengers.
Required:
Prepare the company's flexible budget for July](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5611c6de-96f4-4720-97c2-15756f5bd45b%2F63c383d7-ae22-4db4-bb3f-d45f4a0c5b68%2Fm54kcmq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 9-5 (Algo) Prepare a Flexible Budget with More Than One Cost Driver [LO9-5]
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 84 passengers can
be accommodated on the tour boat. Data concerning the company's cost formulas appear below.
Vessel operating costs
Advertising
Administrative costa
Insurance
Fixed
Cost per Cost per cost per
Month
Cruise
$ 6,100 $475.00
Passenger
$ 3.10
$ 2,800
$ 32.00
$1.50
$5,400
$3,900
For example, vessel operating costs should be $6,100 per month plus $475.00 per cruise plus $3.10 per passenger. The company's
sales should average $32.00 per passenger. In July, the company provided 51 cruises for a total of 3,000 passengers.
Required:
Prepare the company's flexible budget for July
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