Analyze Performance for a Restaurant: Persons Deli is planning to expand operations and, hence is concerned that its reporting system may need improvement. The master budget income statement for its Akron Persons Deli, which contains a delicatessen and restaurant operation, is (in thousands):

The performance report that the company uses for management evaluation is as follows:

Required: Prepare a profit variance analysis for the delicatessen segment. (Hint: Use gross sales as your measure of volume.)

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Gross sales Purchases Hourly wages Franchise fee Advertising Utilities Depreciation Lease cost Salaries Total costs Operating profit Delicatessen $1,000 Restaurant Total $2,500 $3,500 1,000 1,600 875 925 75 105 300 195 e8 3888 125 80 80 3,410 $ 90