Question

Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria's owner has determined that the shop has two major cost drivers--the number of pizzas sold and the number of deliveries made. The pizzeria's cost formulas appear below. Fixed Cost per Month Cost per a Delivery $6,370 $ 840 Pizza ingredients Kitchen statt Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $ 860 $ 584 $2.330 0.10 In November, the pizzeria budgeted for 2.250 pizzas at an average selling price of $22 per pizza and for 210 deliveries. Data concerning the pizzeria's actual results in November appear below: Actual Results 1.350 Deliveries Revenge Pizza ingredients Kitchen statt Utilities Delivery person Delivery vehicle Equipment depreciation $11.350 $ 6,310 1.000 1,032 584 Miscellaneous

Answer 1

Milano Pizza Flexible Budget Performance Report For The Month Ended November 30
	Actual results	Revenue and spending variance		Flexible budget	Activity variance		Planning budget
Pizzas	2,350			2,350			2,250
Deliveries	190			190			210
Revenue	$52,480	$780	F	$51,700 (2,350*$22)	$2,200	F	$49,500 (2,250*$22)
Expenses:
Pizza ingredients	11,350	775	U	10,575 (2,350*$4.50)	450	U	10,125 (2,250*$4.50)
Kitchen staff	6,310	60	F	6,370	0	None	6,370
Utilities	1,000	1,250	F	2,250 (2,350*$0.6 + 840)	60	U	2,190 (2,250*$0.6 + 840)
Delivery person	646	0	None	646 (190*$3.40)	68	F	714 (210*$3.40)
Delivery vehicle	1,032	113	F	1,145 (190*$1.50+860)	30	F	1,175 (210*$1.50+860)
Equipment depreciation	584	0	None	584	0	None	584
Rent	2,330	0	None	2,330	0	None	2,330
Miscellaneous	928	267	F	1,195 (2,350*$0.10+960)	10	U	1,185 (2,250*$0.10+960)
Total expenses	24,180	915	F	25,095	422	U	24,673
Net operating income	$28,300	$1,695	F	$26,605	$1,778	F	$24,827