The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two...
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The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 61 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Course Student Instructor wages $ 2,910 Classroom supplies $ 300 Utilities $ 1,220 $ 65 Campus rent $ 4,700 Insurance $ 2,300 Administrative expenses $ 3,600 $ 40 $ 6 For example, administrative expenses should be $3,600 per month plus $40 per course plus $6 per student. The company's sales should average $900 per student. The company planned to run four courses with a total of 61 students; however, it actually ran four courses with a total of only 51 students. The actual operating results for September were as follows: Revenue Instructor wages Classroom supplies Actual $ 52,000 $ 10,920 $ 18,150 $ 1,890 Utilities Campus rent $ 4,700 Insurance $ 2,440 Administrative expenses $ 3,552 Required: Prepare a flexible budget performance report for September. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 61 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Course Student Instructor wages $ 2,910 Classroom supplies $ 300 Utilities $ 1,220 $ 65 Campus rent $ 4,700 Insurance $ 2,300 Administrative expenses $ 3,600 $ 40 $ 6 For example, administrative expenses should be $3,600 per month plus $40 per course plus $6 per student. The company's sales should average $900 per student. The company planned to run four courses with a total of 61 students; however, it actually ran four courses with a total of only 51 students. The actual operating results for September were as follows: Revenue Instructor wages Classroom supplies Actual $ 52,000 $ 10,920 $ 18,150 $ 1,890 Utilities Campus rent $ 4,700 Insurance $ 2,440 Administrative expenses $ 3,552 Required: Prepare a flexible budget performance report for September. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.
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Answer To prepare a flexible budget performance report for September we need to compare the actual r... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-0078111006
14th edition
Authors: Ray Garrison, Eric Noreen and Peter Brewer
Posted Date:
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