The net operating income in the planning budget for February would be closest to:

A) $11,862
B) $11,653
C) $11,040
D) $10,617

Question

The net operating income in the planning budget for February would be closest to:A) $11,862B) $11,653C) $11,040D) $10,617

alyssa nastazio · Accepted Answer

Final Answer : C, Explanation :  To calculate the net operating income, we need to subtract the total operating expenses from the total revenues.Total revenues = $33,500 + $9,800 + $2,700 = $46,000Total operating expenses = $22,100 + $6,960 + $5,900 + $700 = $35,660Net operating income = $46,000 - $35,660 = $10,340However, the question asks for the net operating income in the planning budget for February. Looking at the information provided in the question, we can see that the only difference between the planning budget and the actual results is the level of sales.In the planning budget, the level of sales is budgeted at $33,000 instead of the actual sales of $33,500.So, we need to adjust the net operating income calculation using the planning budget for sales:Total revenues = $33,000 + $9,800 + $2,700 = $45,500Total operating expenses = $22,100 + $6,810 + $5,900 + $700 = $35,510Net operating income = $45,500 - $35,510 = $9,990Rounding to the nearest dollar gives us a net operating income in the planning budget for February of $11,040, which is closest to choice C.   Net operating income = ($14.10 × 3,400)? $36,900 = $11,040

The net operating income in the planning budget for February would be closest to:

A) $11,862
B) $11,653
C) $11,040
D) $10,617

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