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 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 $2,930

Classroom supplies $290

Utilities $1,200 $70

Campus rent $5,200

Insurance $2,100

Administrative expenses $3,800 $46 $6

For example, administrative expenses should be $3,800 per month plus $46 per course plus $6 per student. The companys sales should average $900 per student.

The company planned to run four courses with a total of 63 students; however, it actually ran four courses with a total of only 59 students. The actual operating results for September appear below:

Actual

Revenue $53,800

Instructor wages $11,000

Classroom supplies $18,120

Utilities $1,890

Campus rent $5,200

Insurance $2,240

Administrative expenses $3,788

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.