Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the month of June: Revenue Raw materials Wages Utilities Rent Insurance Miscellaneous Revenue Expenses: Raw materials Fixed Element per Month While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $7,300 plus $3.10 per liter of gelato sold and the actual wages for June were $26,400. Via Gelato expected to sell 6,100 liters in June, but actually sold 6,300 liters. Via Gelato Revenue and Spending Variances For the Month Ended June 30 Wages Utilities Rent $ 7,300 $3,330 $ 4,300 $3,050 $ 820 Required: Calculate Via Gelato revenue and spending variances for June. (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.) Insurance Miscellaneous Variable Element per Liter $29.00 $6.35 $ 3.10 $ 1.90 Total expense Net operating income 2.05 Actual Total for June $ 175,540 $ 40,630 $ 26,400 $ 16,100 $ 4,300 $ 3,050 $ 12,990
Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the month of June: Revenue Raw materials Wages Utilities Rent Insurance Miscellaneous Revenue Expenses: Raw materials Fixed Element per Month While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $7,300 plus $3.10 per liter of gelato sold and the actual wages for June were $26,400. Via Gelato expected to sell 6,100 liters in June, but actually sold 6,300 liters. Via Gelato Revenue and Spending Variances For the Month Ended June 30 Wages Utilities Rent $ 7,300 $3,330 $ 4,300 $3,050 $ 820 Required: Calculate Via Gelato revenue and spending variances for June. (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.) Insurance Miscellaneous Variable Element per Liter $29.00 $6.35 $ 3.10 $ 1.90 Total expense Net operating income 2.05 Actual Total for June $ 175,540 $ 40,630 $ 26,400 $ 16,100 $ 4,300 $ 3,050 $ 12,990
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the
month of June:
Revenue
Raw materials
Wages
Utilities.
Rent
Insurance
Miscellaneous
Revenue
Expenses:
While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example,
wages should be $7,300 plus $3.10 per liter of gelato sold and the actual wages for June were $26,400. Via Gelato expected to sell
6,100 liters in June, but actually sold 6,300 liters.
Raw materials
Fixed
Element
per Month
Required:
Calculate Via Gelato revenue and spending variances for June. (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.)
Via Gelato
Revenue and Spending Variances
For the Month Ended June 30
Wages
Utilities
Rent
$ 7,300
$ 3,330
$ 4,300
$ 3,050
$ 820
Insurance
Miscellaneous
Variable
Actual
Element per Total for
June
Liter
$29.00
$ 6.35
$ 175,540
$ 40,630
$ 3.10
$ 26,400
$ 1.90
$ 16,100
$ 4,300
$ 3,050
$ 12,990
Total expense
Net operating income
2.05
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