The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers 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 50 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		$ 3,080
Classroom supplies			$ 260
Utilities	$ 870	$ 130
Campus rent	$ 4,200
Insurance	$ 1,890
Administrative expenses	$ 3,270	$ 15	$ 4

For example, administrative expenses should be $3,270 per month plus $15 per course plus $4 per student. The companys sales should average $800 per student.

The company planned to run three courses with a total of 45 students; however, it actually ran three courses with a total of only 42 students. The actual operating results for September appear below:

	Actual
Revenue	$ 32,400
Instructor wages	$ 9,080
Classroom supplies	$ 8,540
Utilities	$ 1,530
Campus rent	$ 4,200
Insurance	$ 1,890
Administrative expenses	$ 3,790

Required:

1. Prepare the companys planning budget for September.

2. Prepare the companys flexible budget for September.

3. Calculate the revenue and spending variances for September.

Gourmand Cooking School Revenue and Spending Variances For the Month Ended September 30 \begin{tabular}{|l|r|r|r|r|} \hline & \multicolumn{1}{|c|}{ActualResults} & \multicolumn{2}{c|}{RevenueandSpendingVariances} & FlexibleBudget \\ \hline Courses & 3 & & & 42 \\ \hline Students & 42 & & & \\ \hline Revenue & $52,400 & & & \\ \hline Expenses: & & & & \\ \hline Instructor wages & 9,080 & & \\ \hline Classroom supplies & 8,540 & & \\ \hline Utilities & 1,530 & & \\ \hline Campus rent & 4,200 & & \\ \hline Insurance & 1,890 & & \\ \hline Administrative expenses & 3,790 & & \\ \hline Total expense & 29,030 & & \\ \hline Net operating income & 3,370 & & \\ \hline \end{tabular}