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    Budgeted Overhead Cost for the Marchi Family Inn

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    Marchi Family Inn is a bed and breakfast establishment in a converted 100-year-old mansion. The Inn's guests appreciate its gourmet breakfasts and individually decorated rooms. The Inn's overhead budget for the most recent month appears below:

    Activity level 65 Guests
    Variable overhead costs:
    Supplies $ 156
    Laundry $ 364
    Fixed overhead costs:
    Utilities $ 250
    Salaries and wages $4,480
    Depreciation $1,330
    Total overhead cost $6,580

    The Inn's variable overhead costs are driven by the number of guests. What would be the total budgeted overhead cost for a month if the activity level is 70 guests?

    Question 1 answers
    a. $42,460.00
    b. $6,620.00
    c. $7,086.15
    d. $6,580.00

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    Solution Summary

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