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) 300 Revenue ($480.00g) $144,000 Expenses: Wages and salaries ($11,300 + $122.00q) Supplies ($6.00g) Equipment rental ($2,500 + $26.00g) Insurance ($3,900) Miscellaneous ($500 + $1.46q) Total expense 47,900 1,800 10,300 3,900 938 64,838 $ 79,162 Net operating income

Answer 1

Flexible budget

For the month ended May 31

Budgeted diving hours	290
Price per diving hour	$480
Revenue (480 x 290)	139,200
Expenses :
Wages and salaries (11,300 + 122 x 290)	46,680
Supplies (6 x 290)	1,740
Equipment rental (2,500 + 26 x 290)	10,040
Insurance	3,900
Miscellaneous (500 + 1.46 x 290)	923
Total expenses	-63,283
Net operating income	$75,917

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