The Saint Lucia Blood Bank, a private charity partly supported by government grants, is located on the Caribbean island of Saint Lucia. The blood bank has just finished its operations for September, which was a very busy month due to a powerful hurricane that hit neighboring islands causing many injuries. The hurricanes largely bypassed Saint Lucia, but residents of Saint Lucia willingly donated their blood to help people on other islands. As a consequence, the blood bank collected and processed over 20% more blood than had been originally planned for the month.

A report prepared by a government official comparing actual costs to budgeted costs for the blood bank appears below. Continued support from the government depends on the blood bank's ability to demonstrate control over its costs.

Saint Lucia Blood Bank

Cost Control Report

For the Month Ended September 30

Liters of blood collected: Actual Results was 560, Planning Budget was 440.

Medical supplies: Actual Results was $10,692, Planning Budget was $8,800 and Variances was $1,892 (unfavorable).

Lab tests: Actual Results was 6,041, Planning Budget was 5,808 and Variances was 233 (unfavorable).

Equipment depreciation: Actual Results was 4,585, Planning budget was 4,200 and variances was 385 (unfavorable).

Rent: Actual results was 1,850, Planning budget was 1,850 and variances was 0.

Utilities: Actual results was 1,029, Planning budget was 925 and variances was 104 (unfavorable).

administration: Actual results was 13,009, Planning budget was 12,434 and variances was 575 (unfavorable).

Total expense: Actual results was $37,206, Planning budget was $34,017 and variances was $3,189 (unfavorable).

The managing director of the blood bank was very unhappy with this report, claiming that his costs were higher than expected due to the emergency on the neighboring islands. He also pointed out that the additional costs had been fully covered by payments from grateful recipients on the other islands. The government official who prepared the report countered that all of the figures had been submitted by the blood bank to the government; he was just pointing out that actual costs were a lot higher than promised in the budget.

The following cost formulas were used to construct the planning budget:

Cost Formulas

Medical supplies $20.00q

Lab tests $13.20q

Equipment depreciation $4,200

Rent $1,850

Utilities $925

Administration $10,850+ $3.60q

Required:

1. Complete the flexible budget performance report 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.)