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

question 64

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Stent 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 February, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,950 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February: Stent 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 February, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,950 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:   -The spending variance for facility expenses in February would be closest to: A)  $130 U B)  $130 F C)  $5 U D)  $5 F
-The spending variance for facility expenses in February would be closest to:


Definitions:

Sensitivity Analysis

A method to assess the riskiness of a capital investment by forecasting the most optimistic, the normal, and the most pessimistic outcomes possible under reasonable circumstances.

Net Present Value

A financial metric that calculates the present value of all future cash flows of a project minus the initial investment.

Capital Investment

The spending of money by a business on physical assets like property, industrial buildings, or equipment to enhance its operations and profitability.

Domestic Bond

A bond issued within a country and denominated in the currency of that country, typically purchased by residents of the country.

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