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)		350
Revenue ($420.00q)	$	147,000
Expenses:
Wages and salaries ($11,000 + $120.00q)		53,000
Supplies ($3.00q)		1,050
Equipment rental ($2,300 + $21.00q)		9,650
Insurance ($4,100)		4,100
Miscellaneous ($520 + $1.44q)		1,024
Total expense		68,824
Net operating income	$	78,176

During May, the company’s actual activity was 340 diving-hours.

Required:

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

Answer 1

Puget Sound Divers Flexible Budget For the Month Ended May 31 Actual diving - hours 340 142800 Revenue: Expenses: Wages and salaries Supplies Equipment rental Insurance Miscellaneous Total expenses Net operating income 51800 1020 9440 4100 1010 67370 75430