The Toque Cooking Academy runs short cooking courses at its small campus. Manage

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 reports-the 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 61 students enrolled in those four courses. Data concerning the company's cost formulas appear below: Fixed Cost Cost per Cost per per Month Course Student Instructor wages Classroom supplies Ublities Campus rent S 2,930 $ 290 1,210 90 $4,600 $2,100 Administrative expenses $3,500403 For example, administrative expenses should be $3,500 per month plus $40 per course plus $3 per student. The company's 860 per student. sales should average $ The actual operating results for October appear below Revenue Instructor wages Classroom supplies Ublities Campus rent Actual $49,560 $11,000 17,540 $ 1,980 $ 4,600 S 2,240 $ 3,269 Administrative expenses Required 1. The Toque Cooking Academy expects to run four courses with a total of 61 students in October. Prepare the company's planning budget for this level of activity. (Input all amounts as positive values.) Toque Cooking Academy Planning Budget For the Month Ended October 31 S 52460 Expenses: Instructor wages Classroom supplies Utilities Campus rent 11720 17690 1570 4600 2100 3843 Administrative expenses Total expense Net operating income $ 10937

Explanation / Answer

3) Revenue and spending variance

Revenue 1180 U Expense Instructor wages 720 F Classroom supplies 430 U Utilities 410 U Campus rent 0 None Insurance 140 U Administrative expense 568 F Total expense 308 F Net operating income 872 U

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