Student Accounting Club (SAC), the accounting society, held a party. The society expected attendance of 70 persons and prepared the following budget:

After SAC paid all the bills for the party, the total cost came to £1,865, or £205 over budget. Details are £140 for room rental; £865 for food; £600 for entertainment; and £260 for decorations. Eighty-five persons attended the party.

1. Prepare a performance report for the party that shows how actual costs differed from the budget. That is, include in your report the budgeted amounts, actual amounts and variances.

2. Suppose the society uses a management-by-exception rule. Which costs deserve further examination? Why?

Transcribed Image Text:

Room rental Food Entertainment Decorations Total £ 140 700 600 220 £1,660