M&S Mortgage Jillian Taylor manages the Colorado mortgage processing office of M generates mortgage applications via Internet leads that are followed up by a sales force that to a manager other than Jillian. Once the salespeople secure a mortgage application from a client, Dillian's office prepares and provide the financing to the client. In preparing her budget for next year, she estimates the lowing budgeted amounts: &S Financial Services. M&S all the various mortgage documents required to close the mortgage for M&S fol- Chapter 6 Fixed Costs/Month Variable Costs/Mortgage Salaries Supplies Legal $7,500 100 $120 18 50 Telecom/TT Occupancy 280 3,200 All of Jillian's expenses are for mortgage processors. The costs of the salespeople and market- ing expenses are in a different budget. Since the number of mortgages expected to be processed each month does not vary over the fiscal year, Jillian and M&S prepare a budget for a typical month and use it for all 12 months in the fiscal year Required: Jillian and M&S senior management forecast 90 mortgages per month will be processed in the Colorado office. Prepare the monthly budget for Jillian's office for next year, assuming 90 mortgages per mooth. After the budget is prepared, the economy slips into a severe recession and home sales. new mortgages, and mortgage refinancings fall dramatically. In May (the fifth month of the fiscal year), Jillian's office processes 70 mortgages and has the following operating expenses: a. b. Actual Costs Salaries Supplies Legal TelecomT Occupancy $17,500 1,550 4,100 920 3,100 Based on the budget from part (a), prepare a performance report for Jillian's operations for the month of May c Write a short memo summarizing Jillian's performance based on the performance report prepared in part (b)