Question

Courington Detailing's cost formula for its materials and supplies is $2,060 per month plus $12 per vehicle. For the month of August, the company planned for activity of 86 vehicles, but the actual level of activity was 46 vehicles. The actual materials and supplies for the month was $2,350. The materials and supplies in the planning budget for August would be closest to______________.

Answer 1

Explanation:

The material and supplies in the planning budget is

                               Planning Budget Actual

Materials                $2,060                 $2,350

Vehicles                $1,032                     $552

                              $3,092                    $2,902

The vehicles for planning budget is

= 86 vehicles × $12

= $1,032

And, for the actual budget it is

= 46 vehicles × $12

= $552