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 Costper MonthCost perPizzaCost perDeliveryPizza 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 ResultsPizzas 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.) **Flexible Budget Performance Report****For the Month Ended November 30**| **Category** | **Actual Results** | **Revenue and Spending Variances** | **Flexible Budget** | **Activity Variances** | **Planning Budget** ||----------------------------|--------------------|------------------------------------|---------------------|------------------------|---------------------|| Pizzas | 1,870 | | | | || Deliveries | 190 | | | | || **Revenue** | $26,800 | | | | |**Expenses:**- **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 | | | | || **Total expense** | $20,210 | | | | || **Net operating income** | $6,590 | | | | |**Graph/Diagram Explanation:**This table displays the performance of a flexible budget for a pizza delivery service for the month ending November 30. The columns include:- **Actual Results**: Represents actual numbers achieved during the month.- **Revenue and Spending Variances**: Space for calculating the difference between what was budgeted and what was actually spent or earned.- **Flexible Budget**: Reflects the adjusted budget based on actual activity levels.- **Activity Variances**: Indicates differences due to changes in the level of activity.- **Planning Budget**: Original budget before any adjustments.The table includes major categories such as revenue, various expense lines, total expenses, and net operating income. The exact numbers for variances and budgets other than actual results are to be computed and entered.

Variance is a measure that shows the variation between the actual and the budgeted amounts. There…

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.)

FINANCIAL ACCOUNTING

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ISBN:9781259964947

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Publisher:Libby

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.)

**Flexible Budget Performance Report**

**For the Month Ended November 30**

| **Category** | **Actual Results** | **Revenue and Spending Variances** | **Flexible Budget** | **Activity Variances** | **Planning Budget** |
|----------------------------|--------------------|------------------------------------|---------------------|------------------------|---------------------|
| Pizzas | 1,870 | | | | |
| Deliveries | 190 | | | | |
| **Revenue** | $26,800 | | | | |

**Expenses:**

- **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 | | | | |

| **Total expense** | $20,210 | | | | |
| **Net operating income** | $6,590 | | | | |

**Graph/Diagram Explanation:**

This table displays the performance of a flexible budget for a pizza delivery service for the month ending November 30. The columns include:

- **Actual Results**: Represents actual numbers achieved during the month.
- **Revenue and Spending Variances**: Space for calculating the difference between what was budgeted and what was actually spent or earned.
- **Flexible Budget**: Reflects the adjusted budget based on actual activity levels.
- **Activity Variances**: Indicates differences due to changes in the level of activity.
- **Planning Budget**: Original budget before any adjustments.

The table includes major categories such as revenue, various expense lines, total expenses, and net operating income. The exact numbers for variances and budgets other than actual results are to be computed and entered.

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