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 Pizza $ 4.40 cost per Delivery $6,130 $ 720 $ 0.40 Pizza ingredients Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $3.20 $1.40 $ 740 $ 488 $2,090 $ 840 $ 0.20 In November, the pizzeria budgeted for 1,890 pizzas at an average selling price of $18 per pizza and for 250 deliveries Data concerning the pizzeria's actual results in November appear below: Actual Results 1,990 230 Pizzas Deliveries Revenue $36,480 Ranan dianta

Answer 1

Milano Pizza
Flexible Budget Performance Report
For the Month Ended November 30
	Actual Results	Revenue and spending variances		Flexible Budget	Working	Actvity Variance		Planning Budget	Working
Pizzas	1990			1990				1890
Deliveries	230			230				250
Revenue	$36,480	$660	F	$35,820		$1,800	F	$34,020
Expenses:
Pizza ingredients	$9,190	$434	UF	$8,756	(4.40X1990)	$440	UF	$8,316	(4.40X1890)
Kitchen staff	$6,070	$60	F	$6,130			None	$6,130
Utilities	$940	$576	F	$1,516	(720+ 0.40X1990)	$40	UF	$1,476	(720+ 0.40X1890)
Delivery person	$736	$0	None	$736	(3.20*230)	$64	F	$800	(3.20*250)
Delivery vehicle	$1,008	$54	F	$1,062	(740+1.40*230)	$28	F	$1,090	(740+1.40*250)
Equipment depreciation	$488	$0	None	$488			None	$488
Rent	$2,090	$0	None	$2,090			None	$2,090
Miscellaneous	$856	$382	F	$1,238	(840+0.20*1990)	$20	UF	$1,218	(840+0.20*1890)
Total expense	$21,378	$638	F	$22,016		$408	UF	$21,608
Net operating income	$15,102	$1,298	F	$13,804		$1,392	F	$12,412