Whit Catering Uses Two Measures of Activity,jobs and Meals,in the Cost

question 95

Multiple Choice

Whit Catering uses two measures of activity,jobs and meals,in the cost formulas in its budgets and performance reports.The cost formula for catering supplies is $380 per month plus $94 per job plus $11 per meal.A typical job involves serving a number of meals to guests at a corporate function or at a host's home.The company expected its activity in October to be 20 jobs and 216 meals,but the actual activity was 19 jobs and 221 meals.The actual cost for catering supplies in October was $4,790.The catering supplies in the flexible budget for October would be closest to:

• A)$4,404
• B)$4,790
• C)$4,636
• D)$4,597

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Definitions:

Earnings Per Share

A financial metric that indicates the portion of a company's profit allocated to each outstanding share of common stock, serving as an indicator of the company's profitability.

Mandatorily Redeemable

Financial instruments or securities that the issuer is obligated to buy back or redeem at a predetermined price and date.

Equity

Equity refers to the ownership interest held by shareholders in a corporation, represented by their shares of the company's stock.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, usually with fixed dividends.