Difabio Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting: Fixed elementper monthVariable elementper studentVariable element per courseRevenue$0 $421 $0 Faculty wages$0 $0 $2,800 Course supplies$0 $62 $36 Administrative expenses$31,600 $21 $32 ?In June, the school budgeted for 1,070 students and 90 courses. The actual activity for the month was 1,370 students and 95 courses.Required:?Prepare the school's flexible budget for the actual level of activity in June.
What will be an ideal response?
| Difabio Tech | ||
| Flexible Budget | ||
| For the Month Ended June 30 | ||
| Actual students (q1) | 1,370 | |
| Budgeted courses (q2) | 95 | |
| Revenue ($421q1) | $ | 576,770 |
| Expenses: | ||
| Faculty wages ($2,800q2) | 266,000 | |
| Course supplies ($62q1 + $36q2) | 88,360 | |
| Administrative expenses ($31,600 + $21q1 + $32q2) | 63,410 | |
| Total expense | 417,770 | |
| Net operating income | $ | 159,000 |
Business
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