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

A) $3,905
B) $3,883
C) $8,844
D) $8,920

Question

The net operating income in the planning budget for May would be closest to:A) $3,905B) $3,883C) $8,844D) $8,920

Matias Madriaga · Accepted Answer

Final Answer : D, Explanation :  To calculate net operating income, we subtract total operating expenses from total revenues.Total revenues in May's planning budget are $80,000 for academic programs and $20,000 for community classes, for a total of $100,000.Total operating expenses are the wage and salary expense of $54,000, the rent expense of $12,000, and the supplies expense of $25,080, for a total of $91,080.Net operating income = Total revenues - Total operating expenses = $100,000 - $91,080 = $8,920Therefore, the closest answer choice is D.   Net operating income = ($7.60 × 3,700)? $19,200 = $8,920Reference: CH09-Ref8Duprey Clinic uses client-visits as its measure of activity.During January, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,150 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:Data used in budgeting:   Actual results for January:

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

A) $3,905
B) $3,883
C) $8,844
D) $8,920

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