Organization LO9-1, LO9-2, LO9-3, LO9-4, LO9-6 pported by government grants, is located PROBLEM 9-23 Performance Report for a Nonprofit Organization LO9-1, LO9-2, LOY-3, The St. Lucia Blood Bank, a private charity partly supported by government and on the Caribbean island of St. Lucia. The blood bank has just finished its operations to tember, which was a very busy month due to a powerful hurricane that hit neighboring Island causing many injuries. The hurricane largely bypassed St. Lucia, but residents of a willingly donated their blood to help people on other islands. As a consequence, the bio bank collected and processed over 20% more blood than had been originally planned for the month. report prepared by a government official comparing actual costs to budgeted costs for the bank appears below. Continued support from the government depends on the blood bank's ability to demonstrate control over its costs. St. Lucia Blood Bank Cost Control Report For the Month Ended September 30 Actual Planning Results Budget Variances Liters of blood collected ........ 620 500 Medical supplies .......... $ 9,250 $ 7,500 $1,750 U Lab tests 6,180 6,000 180 U Equipment depreciation ........ 2,800 2,500 300 U Rent 1,000 1,000 0 Utilities 570 500 Administration ........... . 11,740 11,250 490 U Total expense $31,540 $28,750 $2,790 U 70 U The managing director of the blood bank was very unhappy with this report, claiming that his costs were higher than expected due to the emergency on the neighboring islands. He also pointed out that the additional costs had been fully covered by payments from grateful recipients on the other islands. The government official who prepared the report countered that all of the figures had been submitted by the blood bank to the government; he was just pointing out that actual costs were a lot higher than promised in the budget. The following cost formulas were used to construct the planning budget: Cost Formulas Medical supplies ....... $15.00 Lab tests $12.00 Equipment depreciation ........ $2,500 Rent .... $1,000 Utilities .......... $500 Administration ................. ..... $10,000+ $2.500 Required: 1. Using Exhibit 9-8 as your guide, prepare a flexible budget performance report for September. 2. Do you think any of the variances in the report you prepared should be investigated? Why