Chap 9 Q2

The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers that it uses in its budgeting and performance reportsthe 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 companys cost formulas appear below:

	Fixed Cost per Month		Cost per Course		Cost per Student
Instructor wages			$	2,970
Classroom supplies					$	280
Utilities	$	1,220	$	75
Campus rent	$	5,000
Insurance	$	2,100
Administrative expenses	$	3,900	$	45	$	6

For example, administrative expenses should be $3,900 per month plus $45 per course plus $6 per student. The companys sales should average $890 per student.

The actual operating results for September appear below:

		Actual
Revenue	$	51,390
Instructor wages	$	11,160
Classroom supplies	$	16,930
Utilities	$	1,930
Campus rent	$	5,000
Insurance	$	2,240
Administrative expenses	$	3,872