Question

Gator Divers is a company that provides diving services such as underwater ship repairs to clients in the Tampa Bay area. The company’s planning budget for March appears below:
Gator Divers
Planning Budget
For the Month Ended March 31
Budgeted diving-hours (q) . . . . . . . . . . . . . . . . . . . . . 200
Revenue ($380.00q) . . . . . . . . . . . . . . . . . . . . . . . . . . $76,000
Expenses:
Wages and salaries ($12,000 + $130.00q) . . . . . . 38,000
Supplies ($5.00q) . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
Equipment rental ($2,500 + $26.00q) . . . . . . . . . . 7,700
Insurance ($4,200) . . . . . . . . . . . . . . . . . . . . . . . . . 4,200
Miscellaneous ($540 + $1.50q) . . . . . . . . . . . . . . . 840
Total expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,740
Net operating income . . . . . . . . . . . . . . . . . . . . . . . . . $24,260

Required:
During March, the company’s activity was actually 190 diving-hours. Prepare a flexible budget for that level of activity.



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  • CreatedSeptember 27, 2013
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