Supreme Catering
at the End of January, Supreme Catering Prepared

question 102

Multiple Choice

Supreme Catering
At the end of January, Supreme Catering prepared the following budget for the upcoming month of February estimating that they would serve 3000 people:
$\begin{array}{lr} \text { Sales revenue per guest } &\$20\\ \text { Variable costs per guest} &8\\ \text { Total fixed costs } &\$5000\\\end{array}$

During February, there were 2700 guests actually served. Actual costs incurred were $27 000 for variable costs and $6500 for fixed costs. Each guest was charged $20.
-Supreme Catering's flexible budget for February would show net income of:

• A) $31 000
• B) $20 500
• C) $27 400
• D) $19 000