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1. Bobe Air uses two measures of activity, flights and passengers, in the cost formulas...

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Accounting

1. Bobe Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $48,400 per month plus $2,920 per flight plus $5 per passenger. The company expected its activity in May to be 50 flights and 213 passengers, but the actual activity was 53 flights and 212 passengers. The actual cost for plane operating costs in May was $203,405. The plane operating costs in the planning budget for May would be closest to:

2.

Adi Manufacturing Corporation is estimating the following raw material purchases for the final four months of the year:

September $990,000
October $948,000
November $932,000
December $940,000

At Adi, 25% of raw materials purchases are normally paid for in the month of purchase. The remaining 75% is paid for in the month following the purchase. In Adi's budgeted balance sheet at December 31, at what amount will accounts payable for raw materials be shown?

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