The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses inits budgeting and performance reports-the number of courses and the total number of students. For example, the school might runtwo courses in a month and have a total of 60 students enrolled in those two courses. Data concerning the company's cost formulasappear below:Instructor wages.Classroom suppliesUtilitiesCampus rentInsuranceAdministrative expensesFixedCost perMonth$1,210$4,600$ 2,200$4,000RevenueInstructor wagesClassroom suppliesUtilitiesCampus rentInsuranceAdministrative expensesCost per Cost perCourseStudent$ 2,980$75$44$ 300For example, administrative expenses should be $4,000 per month plus $44 per course plus $6 per student. The company's salesshould average $900 per student.Actual$ 51,100$11,200$ 17,850$ 1,920$4,600$ 2,340$ 3,962$6The company planned to run four courses with a total of 60 students; however, it actually ran four courses with a total of only 54students. The actual operating results for September were as follows:Required:Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September.(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zerovariance). Input all amounts as positive values.)Gourmand Cooking School The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses inits budgeting and performance reports-the number of courses and the total number of students. For example, the school might runtwo courses in a month and have a total of 60 students enrolled in those two courses. Data concerning the company's cost formulasappear below:Instructor wages.Classroom suppliesUtilitiesCampus rentInsuranceAdministrative expensesFixedCost perMonth$1,210$4,600$ 2,200$4,000RevenueInstructor wagesClassroom suppliesUtilitiesCampus rentInsuranceAdministrative expensesCost per Cost perCourseStudent$ 2,980$75$44$ 300For example, administrative expenses should be $4,000 per month plus $44 per course plus $6 per student. The company's salesshould average $900 per student.Actual$ 51,100$11,200$ 17,850$ 1,920$4,600$ 2,340$ 3,962$6The company planned to run four courses with a total of 60 students; however, it actually ran four courses with a total of only 54students. The actual operating results for September were as follows:Required:Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September.(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zerovariance). Input all amounts as positive values.)Gourmand Cooking School

A budget is a forecast of revenue and expenses for a certain future period of time that is generally…

The Gourmand Cooking School runs short cooking courses at its small campus. Management has identified two cost drivers it uses in its budgeting and performance reports-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 60 students enrolled in those two courses. Data concerning the company's cost formulas appear below: Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Fixed Cost per Cost per Cost per Month Student $1,210 $4,600 $2,200 $4,000 Revenue Instructor wages Classroom supplies Utilities Campus rent Insurance Administrative expenses Course $ 2,980 $75 $44 $6 For example, administrative expenses should be $4,000 per month plus $44 per course plus $6 per student. The company's sales should average $900 per student. $ 300 The company planned to run four courses with a total of 60 students; however, it actually ran four courses with a total of only 54 students. The actual operating results for September were as follows: Actual $ 51,100 $ 11,200 $ 17,850 $ 1,920 $4,600 $ 2,340 $ 3,962 Required: Prepare a flexible budget performance report that shows both revenue and spending variances and activity variances for September. (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.)

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 20BEA: Using Regression to Calculate Fixed Cost, Calculate the Variable Rate, Construct a Cost Formula, and...