The Case The Little Theater is a nonprofit organtzation devoted to staging plays for children. The theater has a very small full-time professional administrative staff. Through a speclal arrangement with the actors' union, actors and directors rehearse without pay and are paid only for actual performances. The Little Theater has tentatively planned to put on six different productions with a total of 108 performances. For example, one of the productions was Peter Rabbit, which had a six- week run with three performances on each weekend. The costs from the current years planning budget appear below. The Little Theater Costs from the Planning Budget For the year ended December 31 Budgeted number of productions 6 Budgeted number of performances 108 $216,000 Actors and directors' wages 32,400 Stagehand wages 16,200 Ticket booth personnel & ushers wages 108,000 Scenery, costumes & props 54,000 Theater hall rent 27,000 Printed programs 12,000 Publicity Administrative expenses 43,200 $508,800 Total Some of the costs vary with the number of productions, some with the number of performances, and some are fixed and depend on neither the number of productions nor the number of performances. The costs of scenery, costumes, props and publicity vary with the number of productions. It doesn't make any difference how many times Peter Rabbit is performed, the cost off the scenery is the same. Likewise, the cost of publicizing a play with posters and radio commercials is the same whether or not there is 10, 20, or 30 performances of the play. On the other hand, the wages of the actors, directors, stagehands ticket booth personnel, and ushers vary with the number of performances. The greater the number of performances, the higher the wage costs will be. Similarly, the costs of renting the hall and printing the programs will vary with the number of performances. Administrative expenses are more difficult to analyze, but the best estimate is that approximately 75% of the budgeted costs are fixed, 15% depend on the number of productions staged, and the remaining 10% depend on the number of performances. After the beginning of the year, the board of directors of the theater authorized expanding the theater's program to seven productions and a total of 168 performances. Not surprisingly actual costs were considerably higher than the costs from the planning budget. (Grants from donors and ticket sales were also correspondingly higher, but not shown here.) Data concerning the actual costs appear below