The Toque Cooking Academy runs short cooking courses at its small campus. Manage
ID: 2379346 • Letter: T
Question
The Toque Cooking Academy runs short cooking courses at its small campus. Management has identified two cost drivers that it uses in its budgeting and performance reportsâthe number of courses and the total number of students. For example, the school might run four courses in a month and have a total of 60 students enrolled in those four courses. Data concerning the companyâs cost formulas appear below:
For example, administrative expenses should be $3,700 per month plus $43 per course plus $5 per student. The companys sales should average $880 per student.
The actual operating results for October appear below:
1. The Toque Cooking Academy expects to run four courses with a total of 60 students in October. Complete the companys planning budget for this level of activity.
2 The school actually ran four courses with a total of 58 students in October. Complete the companys flexible budget for this level of activity.
3. Complete the flexible budget performance report that shows both activity variances and revenue and spending variances for October.
Student Instructor wages $2,910 Classroom supplies $290 Utilities $ 1,220 $60 Campus rent $ 4,600 Insurance $ 2,200 Administrative expenses $ 3,700 $43 $5
Explanation / Answer
Toque Cooking Academy
Planning Budget
For the Month Ended October 31
Budgeted courses (q1)?
4
Budgeted students (q2)?
60
Revenue ?
$51,000
Expenses:
Instructor wages
10,920
Classroom supplies
17,250
Utilities?
1,870
Campus rent
4,600
Insurance
2,340
Administrative expenses ?
3,598
Total expense?
Net operating income?
$
Toque Cooking Academy
Planning Budget
For the Month Ended October 31
Budgeted courses (q1)?
4
Budgeted students (q2)?
60
Revenue ?
$51,000
Expenses:
Instructor wages
10,920
Classroom supplies
17,250
Utilities?
1,870
Campus rent
4,600
Insurance
2,340
Administrative expenses ?
3,598
Total expense?
Net operating income?
$
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