The Redmond Management Association held its annual public relations luncheon in April 2017 Based on the previous years results, the organization allocated $25,290 of its operating budget to cover the cost of the luncheon To ensure that costs would be appropriately controlled, Molly Hubbard, the treasurer, prepared the following budget for the 2017 luncheon The budget for the luncheon was based on the following expectations The meal cost per person was expected to be $14 50 The cost driver for meals was attendance, which was expected to be 1,400 individuals Postage was based on $0 49 per invitation and 3,000 invitations were expected to be mailed The cost driver for postage was number of invitations mailed The facility charge is $1,000 for a room that will accommodate up to 1,600 people the charge for one to hold more than 1,600 people is $1,500 A fixed amount was designated for printing, decorations, the speakers gift, and publicity REDMOND MANAGEMENT ASSOCIATION Public Relations Luncheon Budget April 2017 Operating funds allocated $ 25,290 Expenses Variable costs Meals (1,400 $14 50) 20,300 Postage (3,000 $0 49) 1,470 Fixed costs Facility 1,000 Printing 950 Decorations 840 Speakers gift 130 Publicity 600 Total expenses 25,290 Budget surplus (deficit) $ 0 Actual results for the luncheon follow REDMOND MANAGEMENT ASSOCIATION Actual Results for Public Relations Luncheon April 2017 Operating funds allocated $ 25,290 Expenses Variable costs Meals (1,620 $15 50) 25,110 Postage (4,000 $0 49) 1,960 Fixed costs Facility 1,500 Printing 950 Decorations 840 Speakers gift 130 Publicity 600 Total expenses 31,090 Budget deficit $ (5,800 ) Reasons for the differences between the budgeted and actual data follow The president of the organization, Rodney Snow, increased the invitation list to include 1,000 former members As a result, 4,000 invitations were mailed Attendance was 1,620 individuals Because of higher than expected attendance, the luncheon was moved to a larger room, thereby increasing the facility charge to $1,500 At the last minute, Ms Hubbard decided to add a dessert to the menu, which increased the meal cost to $15 50 per person Printing, decorations, the speakers gift, and publicity costs were as budgeted Required Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget Compute flexible budget variances by comparing the flexible budget with the actual results

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The Redmond Management Association held its annual public relations luncheon in April 2017. Based on the previous years results, the organization allocated $25,290 of its

The Redmond Management Association held its annual public relations luncheon in April 2017. Based on the previous years results, the organization allocated $25,290 of its operating budget to cover the cost of the luncheon. To ensure that costs would be appropriately controlled, Molly Hubbard, the treasurer, prepared the following budget for the 2017 luncheon.

The budget for the luncheon was based on the following expectations:

The meal cost per person was expected to be $14.50. The cost driver for meals was attendance, which was expected to be 1,400 individuals.

Postage was based on $0.49 per invitation and 3,000 invitations were expected to be mailed. The cost driver for postage was number of invitations mailed.

The facility charge is $1,000 for a room that will accommodate up to 1,600 people; the charge for one to hold more than 1,600 people is $1,500.

A fixed amount was designated for printing, decorations, the speakers gift, and publicity.

REDMOND MANAGEMENT ASSOCIATION
Public Relations Luncheon Budget
April 2017
Operating funds allocated	$	25,290
Expenses
Variable costs
Meals (1,400 $14.50)		20,300
Postage (3,000 $0.49)		1,470
Fixed costs
Facility		1,000
Printing		950
Decorations		840
Speakers gift		130
Publicity		600
Total expenses		25,290
Budget surplus (deficit)	$	0

Actual results for the luncheon follow.

REDMOND MANAGEMENT ASSOCIATION
Actual Results for Public Relations Luncheon
April 2017
Operating funds allocated	$	25,290
Expenses
Variable costs
Meals (1,620 $15.50)		25,110
Postage (4,000 $0.49)		1,960
Fixed costs
Facility		1,500
Printing		950
Decorations		840
Speakers gift		130
Publicity		600
Total expenses		31,090
Budget deficit	$	(5,800	)

Reasons for the differences between the budgeted and actual data follow.

The president of the organization, Rodney Snow, increased the invitation list to include 1,000 former members. As a result, 4,000 invitations were mailed.

Attendance was 1,620 individuals. Because of higher-than-expected attendance, the luncheon was moved to a larger room, thereby increasing the facility charge to $1,500.

At the last minute, Ms. Hubbard decided to add a dessert to the menu, which increased the meal cost to $15.50 per person.

Printing, decorations, the speakers gift, and publicity costs were as budgeted.

Required

Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget.

Compute flexible budget variances by comparing the flexible budget with the actual results.