Pearse Kennel Uses Tenant-Days as Its Measure of Activity; an Animal

question 8

Multiple Choice

Pearse Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,980 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting: Actual results for December: The net operating income in the flexible budget for December would be closest to:

• A)$11,200
• B)$11,400
• C)$11,960
• D)$12,121

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