Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The Munchkin Theater is a nonprofit organization devoted to staging plays for children. The theater has a very small full-time professional administrative staff. Through a
The Munchkin Theater is a nonprofit organization devoted to staging plays for children. The theater has a very small full-time professional administrative staff. Through a special arrangement with the actors' union, actors and directors rehearse without pay and are paid only for actual performances The costs from the current year's planning budget appear below. The Munchkin Theater had tentatively planned to put on five different productions with a total of 50 performances. For example, one of the productions was Peter Rabbit, which had five performances The Munchkin Theater Costs from the Planning Budget For the Year Ended December 31 Budgeted number of production:s Budgeted number of performances Actors' and directors' wages Stagehands' wages Ticket booth personnel and ushers wages Scenery, costumes, and props Theater hall rent Printed programs Publicity Administrative expenses 5 50 $115,000 21,500 12,500 41,500 36,500 11,750 13,000 47,000 Total $298,750 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 of the scenery is the same. Likewise, the cost of publicizing a play with posters and radio commercials is the same whether there are 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 pin down, but the best estimate is that approximately 80% of the budgeted costs are fixed, 10% 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 changing the theater's program to four productions and a total of 54 performances. Actual costs were higher than the costs from the planning budget. (Grants from donors and ticket sales were also correspondingly higher, but are not shown here.) Data concerning the actual costs appear below
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started