aulis Kennel uses tenant-days as its measure of activity; an animal housed in the kennel...
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Accounting
aulis 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 5,400 tenant-days, but its actual level of activity was 5,420 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February:
Data used in budgeting:
Fixed element per month
Variable element per tenant-day
Revenue
$ 0
$ 31.90
Wages and salaries
$ 4,400
$ 7.90
Food and supplies
500
12.70
Facility expenses
8,800
4.90
Administrative expenses
7,800
0.20
Total expenses
$ 21,500
$ 25.70
Actual results for February:
Revenue
$ 109,180
Wages and salaries
$ 23,640
Food and supplies
$ 36,804
Facility expenses
$ 19,390
Administrative expenses
$ 9,168
The activity variance for net operating income in February would be closest to:
A: $124 U
B: $8,198 F
C: $124 F
D: $8,198 U
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