Via Gelato is a popular neighborhood gelato shop. The company has provided the f

Question

Via Gelato is a popular neighborhood gelato shop. The company has provided the following data concerning its operations Fixed Variable Actual Element Element Total for per Month per Liter June Revenue Raw materials Wages Utilities Rent Insurance Miscellaneous $12.00 $71,540 $4.65 $29,230 $5,600 1.40 $13,860 $1,630 0.20 S 3,270 $ 2,600 $ 1,350 $ 650 0.35 2,590 $ 2,600 $1,350 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 $5,600 plus $1.40 per liter of gelato sold and the actual wages for June were $13,860. Via Gelato expected to sell 6,000 liters in June, but actually sold 6,200 liters Required Complete the report showing 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.)

Explanation / Answer

Flexible Fixed Variable budget component component no of jobs 6,200 Revenue 12 74400 Raw materials 4.65 28,830 Wages 5,600 1.4 14280 utilities 1,630 0.2 2870 rent 2,600 2,600 insurance 1,350 1,350 miscellanoeus expense 650 0.35 2820 total expense 11830 6.6 52,750 Actual Revenue & spending Flexible budget variance budget 6,200 6,200 Revenue 71,540 2,860 U 74400 less:Exoenses Raw materials 29,230 400 U 28,830 Wages 13,860 420 F 14280 utilities 3,270 400 U 2870 rent 2,600 0 U 2,600 insurance 1,350 0 N 1,350 miscellanoeus expense 2,590 230 F 2820 total expense 52,900 150 U 52,750 Net operating income 18,640 3,010 U 21,650 Flexible Static Fixed Variable budget budget component component no of jobs 52 50 Revenue 360 18720 18000 Technicial wages 6,400 6,400 6,400 mobile lab operating expense 2,900 35 4720 4650 office expense 2,600 2 2704 2700 advertising expense 970 970 970 insurance 1,680 1,680 1,680 miscellaneous expense 500 3 656 650 total expense 15050 40 17,130 17,050 Flexible budget = fixed component + 150 jobs *variable component Static budget    = Fixed component + 140 jobs *variable component Flexible budget performance report Actual Revenue & spending Flexible Activity variance Static budget budget variance budget no of jobs 52 52 50 Revenue 18,950 230 F 18720 720 F 18000 less:Exoenses Technicial wages 6,450 50 U 6,400 0 N 6,400 mobile lab operating expense 4,530 190 F 4720 70 U 4650 office expense 3,050 346 U 2704 4 U 2700 advertising expense 995 25 U 970 0 N 970 insurance 1,680 0 N 1,680 0 N 1,680 miscellaneous expense 465 191 F 656 6 U 650 total expense 17,170 40 U 17,130 80 U 17,050 net operating income 1,780 190 F 1,590 640 F 950

Related Questions

Navigate

• Browse (All)
• Browse V
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.