Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria’s owner has determined that the shop has two major cost drivers—the number of pizzas sold and the number of deliveries made.   The pizzeria’s cost formulas appear below:   Fixed Cost per Month Cost per Pizza Cost per Delivery Pizza ingredients       $ 4.00         Kitchen staff $ 6,050               Utilities $ 680   $ 1.00         Delivery person             $ 2.80   Delivery vehicle $ 700         $ 2.20   Equipment depreciation $ 456               Rent $ 2,010               Miscellaneous $ 800   $ 0.20     In November, the pizzeria budgeted for 1,770 pizzas at an average selling price of $14 per pizza and for 210 deliveries.   Data concerning the pizzeria’s actual results in November appear below:   Actual Results Pizzas   1,870   Deliveries   190           Revenue $ 26,800   Pizza ingredients $ 8,470   Kitchen staff $ 5,990   Utilities $ 920   Delivery person $ 532   Delivery vehicle $ 1,000   Equipment depreciation $ 456   Rent $ 2,010   Miscellaneous $ 832     Required:   1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (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.)

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Chapter1: Financial Statements And Business Decisions
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Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria’s owner has determined that the shop has two major cost drivers—the number of pizzas sold and the number of deliveries made.

 

The pizzeria’s cost formulas appear below:



  Fixed Cost
per Month
Cost per
Pizza
Cost per
Delivery
Pizza ingredients       $ 4.00        
Kitchen staff $ 6,050              
Utilities $ 680   $ 1.00        
Delivery person             $ 2.80  
Delivery vehicle $ 700         $ 2.20  
Equipment depreciation $ 456              
Rent $ 2,010              
Miscellaneous $ 800   $ 0.20    

In November, the pizzeria budgeted for 1,770 pizzas at an average selling price of $14 per pizza and for 210 deliveries.

 

Data concerning the pizzeria’s actual results in November appear below:

  Actual Results
Pizzas   1,870  
Deliveries   190  
       
Revenue $ 26,800  
Pizza ingredients $ 8,470  
Kitchen staff $ 5,990  
Utilities $ 920  
Delivery person $ 532  
Delivery vehicle $ 1,000  
Equipment depreciation $ 456  
Rent $ 2,010  
Miscellaneous $ 832  
 

Required:
 

1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (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.)

 

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