Excel Analytics 09-01 (Static) Flexible Budget Performance Analysis [LO9-2, LO9-3, LO9-5, LO9-6]

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To complete this activity, you will need to have Excel installed on your computer. This exercise requires you to work in Excel and answer questions in Connect. You will read a brief scenario and then download an Excel file that you will need to complete requirements 1 through 9 in Part 1 of this exercise. In Part 2, you will upload your completed workbook.

Some of the requirements include brief video tutorials on using Excel functions. After viewing the tutorials, you will then use what you learned to work directly in Excel to answer the required questions in Connect.

[The following information applies to the questions displayed below.]

The Munchkin Theater is a nonprofit organization devoted to staging plays for children. The theater has a very small full-time professional administrative staff. Through a special arrangement with the actors union, actors and directors rehearse without pay and are paid only for actual performances.

The Munchkin Theater has asked for your help in preparing a Planning budget at the beginning of the year and evaluating actual expenses at the end of the year. The theater expects to put on five different productions with a total of 60 performances. For example, one of the productions is Peter Rabbit, which had been budgeted for five performances. After interviewing various people affiliated with the theater you have developed the following estimated cost formulas for each of the eight expenses that will be included in your Planning budget:

	Cost Formulas
Per Production	Per Performance	Fixed
Actors and directors wages		$ 2,400
Stagehands wages		$ 450
Ticket booth personnel and ushers wages		$ 180
Scenery, costumes, and props	$ 8,600
Theater hall rent		$ 750
Printed programs		$ 175
Publicity	$ 2,600
Administrative expenses	$ 1,296	$ 72	$ 32,400

By the end of the year, The Munchkin Theater actually put on four productions and a total of 64 performances. The actual expenses incurred during the year were as follows:

Actors and directors wages	$ 159,200
Stagehands wages	28,600
Ticket booth personal and ushers wages	12,300
Scenery, costumes, and props	39,300
Theater hall rent	49,600
Printed programs	10,950
Publicity	12,000
Administrative expenses	41,650
Total	$ 353,600

Once you complete the Planning Budget and Flexible Budget Performance Report, refer to your work to answer the forthcoming questions. You will upload your final file in Part 2.

Excel Analytics 09-01 (Static) Part 1

Required:

Click here to download the Excel workbook ExcelAnalytics_FlexibleBudgetPerformanceAnalysis1_Template which you will use to create the Planning Budget and Flexible Budget Performance Report.

Go to the Planning Budget tab within your Excel workbook. Prepare the planning budget in column E of the spreadsheet using the following three-step process:

Create a formula for actors and directors wages in cell E10. Make sure your formula is designed so that you can copy and paste it into cells E11 through E17. What is the total amount of actors and directors wages in your planning budget?

Copy your formula from cell E10 into cells E11 through E17. What is the total amount of administrative expenses in your planning budget (cell E17)?

Use the AutoSum feature to calculate the total amount of expenses in your planning budget (cell E18). What is the total amount?

Go to the Performance Report tab within the Excel workbook. You will continue working on this tab for the remainder of the requirements.

Prepare a flexible budget in column H of the spreadsheet using the following three-step process:

Create a formula for actors and directors wages in cell H10. Make sure your formula is designed so that you can copy and paste it into cells H11 through H17. What is the total amount of actors and directors wages in your flexible budget?

Copy your formula from cell H10 into cells H11 through H17. What is the total amount of administrative expenses in your flexible budget (cell H17)?

Use the AutoSum feature to calculate the total amount of expenses in your flexible budget (cell H18). What is this total amount?

Calculate the amount of the spending variances in column F using the following five-step process (Do not worry about labeling the variances as U or F at this point):

Create a formula for the actors and directors wages spending variance in cell M10. What is the amount of the spending variance for actors and directors wages?

Copy your formula from cell M10 into cells M11 through M17. What is the amount of the spending variance for administrative expenses (cell M17)?

Use the AutoSum feature to calculate the total spending variance in cell M18. What is the total spending variance?

Using the Absolute Value function, input the absolute values of the amounts in cells M10 through M18 into cells F10 through F18.

Hide column M.

Click here for a brief tutorial on IF Statements in Excel.

Insert a favorable (F) or unfavorable (U) label in column G for each spending variance shown in column F using the following two-step process:

Create an IF-THEN statement in cell G10 that properly labels the actors and directors wages spending variance as favorable or unfavorable. (Hint: Your If-Then statement should be focused on the amounts in cells H10 and E10.) What label appears for this variance, F or U?

Copy your IF-THEN statement from cell G10 into cells G11 through G18. What label appears for the administrative expense spending variance, F or U?

Calculate the amount of the activity variances in column I using the following five-step process (Do not worry about labeling the variances as U or F at this point):

Create a formula for the actors and directors wages activity variance in cell N10. What is the amount of the activity variance for actors and directors wages?

Copy your formula from cell N10 into cells N11 through N17. What is the amount of the activity variance for administrative expenses (cell N17)?

Use the AutoSum feature to calculate the total activity variance in cell N18. What is the total activity variance?

Using the Absolute Value function, input the absolute values of the amounts in cells N10 through N18 into cells I10 through I18.

Hide column N.

Insert a favorable (F) or unfavorable (U) label in column J for each activity variance shown in column I using the following two-step process:

Create an IF-THEN statement in cell J10 that properly labels the actors and directors wages activity variance as favorable or unfavorable. (Hint: Your If-Then statement should be focused on the amounts in cells K10 and H10.) What label appears for this variance, F or U?

Copy your IF-THEN statement from cell J10 into cells J11 through J18. What label appears for the administrative expense activity variance, F or U?

The activity variances in column I are influenced by two cost driversnumber of productions and number of performances. Therefore:

In cell I21 create a formula that quantifies the portion of the overall activity variance that is caused solely by the fact that The Munchkin Theatre actually put on four productions instead of the planned number of five productions. What is the amount in cell I21?

In cell I22 create a formula that quantifies the portion of the overall activity variance that is caused solely by the fact that The Munchkin Theatre actually put on 64 performances instead of the planned number of 60 performances. What is the amount in cell I22?

Create IF-THEN statements in cells J21 and J22 that properly label your variances in cells I21 and I22 as favorable (F) or unfavorable (U).

Click here for a brief tutorial on Conditional Formatting in Excel.

Using Conditional Formatting, highlight all spending variances that varied by an absolute value of $1,000 or more. How many of the spending variances are highlighted?

Using Conditional Formatting, highlight all spending variances that vary from the flexible budget by an absolute value of 5% or more. (Hint: Within the conditional formatting drop down menu look for the appropriate formula in the More rules section. Also, make sure your formula does not include any absolute references.) Which spending variances deviate from the flexible budget by at least 5%?

1. check all that apply

• Actors and directors wages
• Stagehands wages
• Ticket booth personnel and ushers wages
• Scenery, costumes, and props
• Theater hall rent
• Printed programs
• Publicity
• Administrative expenses