Theodore's Little Theatre is a nonprofit organization devoted to staging plays for children. The Theatre 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 years planning budget appear below. Theodore's Theatre had tentatively planned to put on 5 different productions with a total of 50 performances. For example, one of the productions was Cinderella, which had a six-week run with three performances on each weekend.

Theodore's Little Theatre Costs from the Planning Budget For the Year Ended December 31
Budgeted number of productions		5
Budgeted number of performances		50
Actors and directors wages	$	145,000
Stagehands wages		24,500
Ticket booth personnel and ushers wages		15,500
Scenery, costumes, and props		44,500
Theatre hall rent		39,500
Printed programs		13,250
Publicity		14,000
Administrative expenses		46,000
Total	$	342,250

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 doesnt make any difference how many times Cinderella 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 60% of the budgeted costs are fixed, 15% depend on the number of productions staged, and the remaining 25% depend on the number of performances.

After the beginning of the year, the board of directors of the Theatre authorized expanding the Theatres program to four productions and a total of 54 performances. Not surprisingly, actual costs were considerably 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:

Theodore's Little Theatre Actual Costs For the Year Ended December 31
Actual number of productions		4
Actual number of performances		54
Actors and directors wages	$	152,000
Stagehands wages		26,100
Ticket booth personnel and ushers wages		17,000
Scenery, costumes, and props		40,800
Theatre hall rent		44,100
Printed programs		13,700
Publicity		13,000
Administrative expenses		44,450
Total	$	351,150

Required:

1.	Prepare a flexible budget for Theodore's Theatre based on the actual activity of the year. (TIP: Review Chapter 8, Flexible Budgets with Multiple cost Drivers).

2.	Prepare a report for the year that shows the spending variances for all expense items. (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.)

Required 1. Prepare a flexible budget for Theodore's Theatre based on the actual activity of the year. TP: Review Chapter 8, Flexible Budgets with Multiple cost Drivers). Flexible Budget For the Year Ended r 31 Actors' and directors' wages Stagehands' wages Ticke: booth personnel and ushers' wages Scenery, costumes, and props Theatre hall rent Printed programs Publicity Total 2. Prepare a report for the year that shows the spending variances for all expense items. (ndicate the effect of each variance by selecting "F"o favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Flexible Budget Performance Report For the Year Ended December 31 Actual Results Spending Variances Flexible Actors' and directors wages Stagehands' wages cke: booth personnel and ushens Scenery, costumes, and props Theatre hall rent Printed programs Publicity 5 152,000 28,100 17,000 40,800 44,100 13,700 13,000 44.450 5 351.150 Total