Exercise 9-12 Working with More Than One Cost Driver (LO9-1, LO9-2, LO9-3) The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses in its budgeting and performance reports--the 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 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Instructor wages class supplies ilities Campus rent Insurance Administrative expenses Fixed Cost per cost per cost per Month Course Student $ 2,980 $280 $1,220 $ 60 $4,800 $2,000 $3,900 $ For example, administrative expenses should be $3,900 per month plus $45 per course plus $7 per student. The company's sales should average $860 per student. The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 60 students. The actual operating results for September appear below: Actual $ 52,140 $11.200 $12.770 Revenue Instructor wages classroom supplies Utilities Campus rent Insurance Administrative expenses $ $ 4,800 2,140 Required: 1. Prepare the company's planning budget for September 2. Prepare the company's flexible budget for September 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the company's planning budget for September Gourmand Cooking School Planning Budget For the Month Ended September 30 Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income 1. Prepare the company's planning budget for September. 2. Prepare the company's flexible budget for September. 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tab Required 1 Required 2 Required 3 Prepare the company's flexible budget for September. Gourmand Cooking School Flexible Budget For the Month Ended September 30 Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income Duired 3. Calculate the revenue and spending variances for September. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Calculate the revenue and spending variances for September. (Indicate the effect of each variance E favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as po Gourmand Cooking School Revenue and Spending Variances For the Month Ended September 30 Actual Revenue and Spending Results Variances Flexible Budget Courses Students $ 52,140 Revenue Expenses: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Net operating income 11,200 17.770 1,870 4,800 2,140 3,954 41,734 10,406 $
