HW9: P9-23 PROBLEM Performance Report for a greepanit LOLOLOL LOL The . Lucia Bed Besk y dy words that of Laci The hemmatorie Themen bat edo luci Junts per de poli he wh o A spor t s to be for the blood gewport the pre t St. Lucia Blood Baru Cost Control Report For the Month September Ludod olded @ D 130 .000 2000 100 Cost Form 595 200 Required: I. L 2. Do you y ou udare a inceptos Seim of the inte sport you should be restigd 0 120 Format for Part 1: St. Lucia Blood Bank Flexible Budget Performance Report For the Month Ended September 30 Actual Results Spending 1 Variances Flexible Budget Activity Variances Planning Budget Liters of blood collected Medical supplies Lab tests Equipment depreciation Rent Utilities Administration Total expense PROBLEM 9-23 Performance Report for a Nonprofit Organization LO9-1, LO9-2, LO9-3, LO9-4, LO9-6 The St. Lucia Blood Bank, a private charity partly supported by government grants, is located on the Caribbean island of St. Lucia. The blood bank has just finished its operations for September, which was a very busy month due to a powerful hurricane that hit neighboring islands causing many injuries. The hurricane largely bypassed St. Lucia, but residents of St. Lucia willingly donated their blood to help people on other islands. As a consequence, the blood bank collected and processed over 20% more blood than had been originally planned for the month. page 443 o A report prepared by a government official comparing actual costs to budgeted costs for the blood bank appears below. Continued support from the government depends on the blood bank's ability to demonstrate control over its costs. o St. Lucia Blood Bank Cost Control Report For the Month Ended September 30 Variances Actual Results 620 $1,750 > Liters of blood collected Medical supplies...... Lab tests Equipment depreciation .... Rent.......... Utilities ........................................................ Administration ............... Total expense.......... 3000 Planning Budget 500 $ 7,500 6,000 2,500 1,000 500 11.250 $28.750 $ 9,250 6,180 2,800 1,000 570 11.740 $31.540 > A dministration. . .. ..... ...... .... .................... 70 490 $2.790 U U U . ........ .... The managing director of the blood bank was very unhappy with this report, claiming that his costs were higher than expected due to the emergency on the neighboring islands. He also pointed out that the additional costs had been fully covered by payments from grateful recipients on the other islands. The government official who prepared the report countered that all of the figures had been submitted by the blood bank to the government; he was just pointing out that actual costs were a lot higher than promised in the budget. The following cost formulas were used to construct the planning budget: Medical supplies......... Lab tests Equipment depreciation... Rent.................... Utilities ................... Administration ............. Cost Formulas $15.000 $12.00 $2,500 $1,000 $500 $10,000+$2.500 ................................ Required: 1. Using Exhibit 9-8 as your guide, prepare a flexible budget performance report for September. 2. Do you think any of the variances in the report you prepared should be investigated? Why? 442 0