Question
Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services.
Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzerias owner has determined that the shop has two major cost driversthe number of pizzas sold and the number of deliveries made. The pizzerias cost formulas appear below: Fixed Cost per Month Cost per Pizza Cost per Delivery Pizza ingredients $ 4.20 Kitchen staff $ 6,090 Utilities $ 700 $ 0.20 Delivery person $ 3.00 Delivery vehicle $ 720 $ 1.20 Equipment depreciation $ 472 Rent $ 2,050 Miscellaneous $ 820 $ 0.10 In November, the pizzeria budgeted for 1,830 pizzas at an average selling price of $16 per pizza and for 230 deliveries. Data concerning the pizzerias actual results in November appear below: Actual Results Pizzas 1,930 Deliveries 210 Revenue $ 31,520 Pizza ingredients $ 8,830 Kitchen staff $ 6,030 Utilities $ 930 Delivery person $ 630 Delivery vehicle $ 1,004 Equipment depreciation $ 472 Rent $ 2,050 Miscellaneous $ 844 Required: 1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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