Question

Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area. The company’s planning budget for May appears below:

Puget Sound Divers Planning Budget For the Month Ended May 31
Budgeted diving-hours (q)		250
Revenue ($460.00q)	$	115,000
Expenses:
Wages and salaries ($11,500 + $130.00q)		44,000
Supplies ($4.00q)		1,000
Equipment rental ($2,300 + $22.00q)		7,800
Insurance ($3,900)		3,900
Miscellaneous ($510 + $1.50q)		885
Total expense		57,585
Net operating income	$	57,415

During May, the company’s actual activity was 240 diving-hours.

Required:

Prepare a flexible budget for May. (Round your answers to the nearest whole number.)

Answer 1