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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 Cost per per Month Pizza ingredients Pizza $ 4.70 Cost per Delivery Kitchen staff $ 6,190 Utilities Delivery person $ 750 $ 0.70 Delivery vehicle $ 770 $ 3.50 $ 1.70 Equipment depreciation Rent $ 512 $ 2,150 Miscellaneous $ 870 $ 0.10 In November, the pizzeria budgeted for 1,980 pizzas at an average selling price of $13 per pizza and for 200 deliveries. Data concerning the pizzeria's actual results in November were as follows: Actual Results 2,080 Pizzas Deliveries Revenue Pizza ingredients Kitchen staff 180 $ 27,730 $ 9,730 $ 6,130 Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous Required: $ 955 $ 630 $ 1,014 $ 512 $ 2,150 $ 874 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.) 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.) Milano Pizza Flexible Budget Performance Report For the Month Ended November 30 Pizzas Deliveries Actual Results 2,080 180 $ 27,730 Revenue Expenses: Pizza ingredients 9,730 Kitchen staff 6,130 Utilities 955 Delivery person 630 Delivery vehicle 1,014 Equipment depreciation 512 Rent 2,150 Miscellaneous 874 Total expense 21,995 Net operating income $ 5,735 Flexible Planning Budget Budget
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