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 63 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Instructor wages Course $ 2,970 Student Classroom supplies $ 290 Utilities $ 1,210 $ 60 Campus rent $ 4,500 Insurance $ 2,300 Administrative expenses $ 3,900 $ 45 $ 6 For example, administrative expenses should be $3,900 per month plus $45 per course plus $6 per student. The company's sales should average $860 per student. The company planned to run four courses with a total of 63 students; however, it actually ran four courses with a total of only 59 students. The actual operating results for September were as follows: Revenue Instructor wages Actual $ 51,280 $ 11,160 Classroom supplies $ 18,120 Utilities $ 1,860 Campus rent $ 4,500 Insurance $ 2,440 Administrative expenses $ 3,884 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. Courses Students Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expenses Net operating income Gourmand Cooking School Flexible Budget Performance Report For the Month Ended September 30 Flexible Planning Actual Results Budget Budget 4 59 $ 51,280 11,160 18,120 1,860 4,500 2,440 3,884 41,964 $ 9,316 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 63 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Instructor wages Course $ 2,970 Student Classroom supplies $ 290 Utilities $ 1,210 $ 60 Campus rent $ 4,500 Insurance $ 2,300 Administrative expenses $ 3,900 $ 45 $ 6 For example, administrative expenses should be $3,900 per month plus $45 per course plus $6 per student. The company's sales should average $860 per student. The company planned to run four courses with a total of 63 students; however, it actually ran four courses with a total of only 59 students. The actual operating results for September were as follows: Revenue Instructor wages Actual $ 51,280 $ 11,160 Classroom supplies $ 18,120 Utilities $ 1,860 Campus rent $ 4,500 Insurance $ 2,440 Administrative expenses $ 3,884 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. Courses Students Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expenses Net operating income Gourmand Cooking School Flexible Budget Performance Report For the Month Ended September 30 Flexible Planning Actual Results Budget Budget 4 59 $ 51,280 11,160 18,120 1,860 4,500 2,440 3,884 41,964 $ 9,316
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Related Book For
Managerial Accounting
ISBN: 978-0078111006
14th edition
Authors: Ray Garrison, Eric Noreen and Peter Brewer
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