The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Instructor wages Course $ 2,950 Student Classroom supplies $ 300 Utilities $ 1,240 $ 75 Campus rent $ 4,800 Insurance Administrative expenses $ 2,200 $ 3,800 $ 42 $ 3 For example, administrative expenses should be $3,800 per month plus $42 per course plus $3 per student. The company's sales should average $890 per student. The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 60 students. The actual operating results for September were as follows: Revenue Actual $ 54,060 Instructor wages $ 11,080 Classroom supplies $ 19,050 Utilities $ 1,950 Campus rent $ 4,800 Insurance $ 2,340 Administrative expenses $ 3,586 Required: Prepare a flexible budget performance report for September. Note: 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.
The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a month and have a total of 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Fixed Cost per Cost per Cost per Month Instructor wages Course $ 2,950 Student Classroom supplies $ 300 Utilities $ 1,240 $ 75 Campus rent $ 4,800 Insurance Administrative expenses $ 2,200 $ 3,800 $ 42 $ 3 For example, administrative expenses should be $3,800 per month plus $42 per course plus $3 per student. The company's sales should average $890 per student. The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 60 students. The actual operating results for September were as follows: Revenue Actual $ 54,060 Instructor wages $ 11,080 Classroom supplies $ 19,050 Utilities $ 1,950 Campus rent $ 4,800 Insurance $ 2,340 Administrative expenses $ 3,586 Required: Prepare a flexible budget performance report for September. Note: 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.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter17: Activity Resource Usage Model And Tactical Decision Making
Section: Chapter Questions
Problem 18E: A company is considering a special order for 1,000 units to be priced at 8.90 (the normal price...
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![Exercise 9-6 (Algo) Working with More Than One Cost Driver [LO9-2, LO9-3, LO9-5, LO9-6]
The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for
budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a
month and have a total of 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below:
Fixed
Cost per Cost per Cost per
Month
Instructor wages
Classroom supplies
Course
$ 2,950
Student
$ 300
Utilities
$ 1,240
$ 75
Campus rent
$ 4,800
Insurance
$ 2,200
Administrative expenses
$ 3,800
$ 42
$ 3
For example, administrative expenses should be $3,800 per month plus $42 per course plus $3 per student. The company's sales
should average $890 per student.
The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 60
students. The actual operating results for September were as follows:
Actual
Revenue
$ 54,060
Instructor wages
$ 11,080
Classroom supplies
$ 19,050
Utilities
$ 1,950
Campus rent
$ 4,800
Insurance
$ 2,340
Administrative expenses
$ 3,586
Required:
Prepare a flexible budget performance report for September.
Note: 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.
Courses
Students
Revenue
Expenses:
Instructor wages
Classroom supplies
Utilities
Campus rent
Insurance
Administrative expenses
Total expenses
Net operating income
Gourmand Cooking School
Flexible Budget Performance Report
For the Month Ended September 30
Flexible
Planning
Actual Results
Budget
Budget
4
60
$
54,060
11,080
19,050
1,950
4,800
2,340
3,586
42,806
$
11,254](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd357412c-7ce8-400e-bb25-57f41d18f1e6%2F514fce75-fc9f-4241-a177-bcdbe46e7bba%2Fkkvs0s1_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 9-6 (Algo) Working with More Than One Cost Driver [LO9-2, LO9-3, LO9-5, LO9-6]
The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses for
budgeting purposes-the number of courses and the total number of students. For example, the school might run two courses in a
month and have a total of 64 students enrolled in those two courses. Data concerning the company's cost formulas appear below:
Fixed
Cost per Cost per Cost per
Month
Instructor wages
Classroom supplies
Course
$ 2,950
Student
$ 300
Utilities
$ 1,240
$ 75
Campus rent
$ 4,800
Insurance
$ 2,200
Administrative expenses
$ 3,800
$ 42
$ 3
For example, administrative expenses should be $3,800 per month plus $42 per course plus $3 per student. The company's sales
should average $890 per student.
The company planned to run four courses with a total of 64 students; however, it actually ran four courses with a total of only 60
students. The actual operating results for September were as follows:
Actual
Revenue
$ 54,060
Instructor wages
$ 11,080
Classroom supplies
$ 19,050
Utilities
$ 1,950
Campus rent
$ 4,800
Insurance
$ 2,340
Administrative expenses
$ 3,586
Required:
Prepare a flexible budget performance report for September.
Note: 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.
Courses
Students
Revenue
Expenses:
Instructor wages
Classroom supplies
Utilities
Campus rent
Insurance
Administrative expenses
Total expenses
Net operating income
Gourmand Cooking School
Flexible Budget Performance Report
For the Month Ended September 30
Flexible
Planning
Actual Results
Budget
Budget
4
60
$
54,060
11,080
19,050
1,950
4,800
2,340
3,586
42,806
$
11,254
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