Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

image text in transcribed
image text in transcribed
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 reports--the 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 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Instructor vages classroom supplies Utilities Campus rent Insurance Administrative expenses Pixed Cost per cost per cost per Month Course Student $ 2,950 $300 $1,240 5 85 $4,800 $2,000 $3,900 42 $ 5 For example, administrative expenses should be $3,900 per month plus $42 per course plus $5 per student. The company's sales should average $880 per student. The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 56 students. The actual operating results for September appear below. Metual Revenue $53, 420 Instructor wages $11,080 classroon supplies $19,050 Utilities $ 1,990 Campus rent $ 4,800 Insurance $ 2,140 Administrative expenses $ 3,814 Required: Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September. (Indicate the effect of each variance by selecting "P" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Required: Prepare a 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 Actual Results Flexible Budget Planning Budget 4 Courses Students 56 + $ 53,420 Revenue Expenses Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Total expense Not operating income 11.080 19,050 1,990 4,800 2,140 3,814 42,874 10,546 $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Wiley CPAexcel Exam Review April Study Guide Regulation 2017

Authors: Wiley

2nd Edition

1119369436, 978-1119369431

More Books

Students also viewed these Accounting questions