Budget management and benchmarking

1 Variance analysis of revenues, multiple countries. Vista Productions markets movies on behalf of independent production companies. It is cur- rently examining the results for Road Warrior, an action movie made in Aus- tralia. Vista has marketing rights in five countries. The budgeted and actual results for these five countries for 19 8 are as follows: Budget for 19_8 Actual for 19_8 Revenue Revenue Tickets Sold Tickets Sold Country per Person per Person $2.50 2.00 United States Canada Japan United Kingdom New Zealand 5,500,000 1,800,000 1,200,000 1,000,000 500,000 $2.40 2.05 3.10 2.10 2.80 5,400,000 2,160,000 6,300,000 2,700,000 1,440,000 2.20 1.80 1.90 REQUIRED 1. Conduct a Level 1 to Level 3 variance analysis (see Exhibit 16-4) of the 19_8 revenues for Vista Productions from marketing Road Warrior. Show computations for each country and for the total of all five coun- tries. 2. What conclusions do you draw from your analysis in requirement 1