Assume you have been asked to prepare a report to be given to the Board of Directors. Your written analysis should address the specific questions below. (You may type directly on this document.)

1. How well did the Little Theatre control its costs during the year? Explain and identify those areas with favorable variances and those with unfavorable variances.

2. The cost formulas provide numbers for the average cost per production and average cost per performance. How accurate do you believe average cost per production and average cost per performance would be for predicting the cost of a new production? Fully explain your opinion. How accurate do you believe average cost per production and average cost per performance would be for predicting the cost if an additional performance of a particular production is added? Fully explain your opinion. Identify any variables that would influence the numbers.