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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 pizzeria's owner has determined that the shop has two major cost drivers-the number of pizzas sold and the number of deliveries made. The pizzeria's cost formulas appear below: Fixed Cost per Month Cost per Cost per Delivery Pizza Pizza ingredients $ 4.80 Kitchen staff $ 6,210 Utilities $ 760 $ 0.80 Delivery person Delivery vehicle $ 780 $ 2.60 $1.80 Equipment depreciation Rent $ 520 $ 2,170 Miscellaneous $ 880 $ 0.20 In November, the pizzeria budgeted for 2,010 pizzas at an average selling price of $14 per pizza and for 210 deliveries. Data concerning the pizzeria's actual results in November appear below: Pizzas Deliveries Revenue Pizza ingredients: Kitchen staff Utilities Delivery person Actual Results 2,110 190 $ 30,240 $ 9,910 $ 6,150 $ 960 $ 494 Delivery vehicle. Equipment depreciation Rent Miscellaneous Required: $ 1,016 $ 520 $ 2,170 $ 880 1. Compute the revenue and spending 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 li.e.. zero variance). Input all amounts as positive values.) Prey 2 of 3 Next > Required: 1. Compute the revenue and spending 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.) Pizzas Deliveries Revenue Milano Pizza Revenue and Spending Variances For the Month Ended November 30 Actual Results Revenue and Spending Variances Flexible. Budget 2,110 190 $ 30,240 Expenses: Pizza ingredients 9,910 Kitchen staff 6,150 Utilities 960 Delivery person 494 Delivery vehicle 1,016 Equipment depreciation 520 Rent 2,170 Miscellaneous 880 Total expense 22,100 Net operating income $ 8,140
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