The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers that it uses in its budgeting and performance reportsthe number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 63 students enrolled in those two courses. Data concerning the companys cost formulas appear below:

	Fixed Cost per Month		Cost per Course		Cost per Student
Instructor wages			$	2,920
Classroom supplies					$	300
Utilities	$	1,240	$	75
Campus rent	$	4,700
Insurance	$	2,100
Administrative expenses	$	4,000	$	42	$	6
For example, administrative expenses should be $4,000 per month plus $42 per course plus $6 per student. The companys sales should average $890 per student. The actual operating results for September appear below:

Actual

Revenue

$

53,170

Instructor wages

$

10,960

Classroom supplies

$

18,750

Utilities

$

1,950

Campus rent

$

4,700

Insurance

$

2,240

Administrative expenses

$

3,972

Required:

1.

The Gourmand Cooking School expects to run four courses with a total of 63 students in September. Complete the companys planning budget for this level of activity.

Gourmand Cooking School
Planning Budget
For the Month Ended September 30
Revenue	?
Expenses:	?
Instructor wages	?
Classroom supplies	?
Utilities	?
Campus rent	?
Insurance	?
Administrative expenses	?
Total expense	0
Net operating income	$0

2.

The school actually ran four courses with a total of 57 students in September. Complete the companys flexible budget for this level of activity.

Gourmand Cooking School
Flexible Budget
For the Month Ended September 30
Revenue	?
Expenses:	?
Instructor wages	?
Classroom supplies	?
Utilities	?
Campus rent	?
Insurance	?
Administrative expenses	?
Total expense	0
Net operating income	$0

3.

Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for September. (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.)

Gourmand Cooking School
Flexible Budget Performance Report
For the Month Ended September 30
	Revenue and Spending Variances		Activity Variances
Revenue	?	F	?	U
Expenses:
Instructor wages	?	F	?	None
Classroom supplies	?	U	?	F
Utilities	?	U	?	None
Campus rent	?	None	?	None
Insurance	?	U	?	None
Administrative expenses	?	F	?	F
Total expense	?	U	?	F
Net operating income	?	F	?	U