Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

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.

image text in transcribedimage text in transcribed

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 driversthe number of pizzas sold and the number of deliveries made. The pizzeria's cost formulas appear below: Fixed Cost per Month Cost per Pizza $ 4.70 cost per Delivery $ 6,190 $ 750 $ 0.70 Pizza ingredients Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $3.50 $1.70 $ 770 $ 512 $2,150 $ 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 appear below: Actual Results 2,080 180 Pizzas Deliveries Revenue Pizza ingredients Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $ 27,730 $ 9,730 $ 6,130 $ 955 $ 630 $ 1,014 $ 512 $ 2,150 $ 874 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.) Milano Pizza Revenue and Spending Variances For the Month Ended November 30 Actual Revenue and Spending Results Variances 2,080 180 Flexible Budget Pizzas Deliveries Revenue | $ 27,730 Expenses: Pizza ingredients Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation Rent 9,730 6,130 955 630 1,014 512 2,150 874| 21,995 5,735 Miscellaneous Total expense Net operating income $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions