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 in its budgeting and performance reports-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 Cost per per Month Course $ 2,900 Cost per Student Instructor wages Classroom supplies Utilities $ 310 $1,220 $ 75 Campus rent $4,800 Insurance $2,300 Administrative expenses $ 3,900 $ 43 $ 5 For example, administrative expenses should be $3,900 per month plus $43 per course plus $5 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 59 students. The actual operating results for September appear below: Actual $ 52,000 Revenue $ 10,880 Instructor wages Classroom supplies. Utilities $ 18,760 $ 1,930 Campus rent 4,800 $ $ 2,440 Insurance Administrative expenses $ 3,803 Required: Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September. (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.) Gourmand Cooking School Flexible Budget Performance Report For the Month Ended September 30 Flexible Actual Results Planning Budget Budget Courses Students 4 59 Revenue $ 52,000 Expenses: 10,880 18,760 1,930 4,800 2,440 3,803 42,613 9,387 Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income $ The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses in its budgeting and performance reports-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 Cost per per Month Course $ 2,900 Cost per Student Instructor wages Classroom supplies Utilities $ 310 $1,220 $ 75 Campus rent $4,800 Insurance $2,300 Administrative expenses $ 3,900 $ 43 $ 5 For example, administrative expenses should be $3,900 per month plus $43 per course plus $5 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 59 students. The actual operating results for September appear below: Actual $ 52,000 Revenue $ 10,880 Instructor wages Classroom supplies. Utilities $ 18,760 $ 1,930 Campus rent 4,800 $ $ 2,440 Insurance Administrative expenses $ 3,803 Required: Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September. (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.) Gourmand Cooking School Flexible Budget Performance Report For the Month Ended September 30 Flexible Actual Results Planning Budget Budget Courses Students 4 59 Revenue $ 52,000 Expenses: 10,880 18,760 1,930 4,800 2,440 3,803 42,613 9,387 Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income $
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Related Book For
Managerial Accounting
ISBN: 978-0697789938
13th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
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