The St. Lucia Blood Bank, a private charity partly supported by government grants, is located on the Caribbean island of St. Lucia. The blood bank has just finished its operations for September, which was a particularly busy month due to a powerful hurricane that hit neighboring islands causing many injuries. The hurricane largely bypassed St. Lucia, but residents of St. 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 banks ability to demonstrate control over its costs.

Problem 10-22 Performance Report for a Nonprofit Organization LO10-1, LO10-4, LO10-6 The St. Lucia Blood Bank, a private charity partly by government grants, is located on the Caribbean island of St. Lucia. The blood bank has just finished its operations for September, which was a particularly busy month due to a powerful hurricane that hit neighboring islands causing many injuries. The hurricane largely bypassed St. Lucia, but residents of St. Lucia willingly donated their blood to help people on othe slands. 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. St. Lucia Blood Bank Cost Control Report For the Month Ended September 30 Planning Actual Results Budget Variances Liters of blood collected 980 800 Medical supplies 318 9,160 2,158 U Lab tests 3,730 11,560 2,170 U Equipment depreciation 590 1,300 290 U 800 800 Rent Utilities 342 310 32 U Administration 4,625 4,460 65 U 43,405 38,590 4,815 U Total expense 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 $11.45a Lab tests $14.45 $1,300 Equipment depreciation Rent $1,800 S310 es $13,100 $1.70 Administration