Question

Milano Pizza is a small neighborhood pizzerla that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzerla'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 Cost per Pizza $ 4.60 Cost per Delivery per Month Pizza ingredients Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation $6,170 740 $0.60 $3.40 $1.60 ces $ 760 $ 504 $2,130 S 860 Rent Miscellaneous $ e.20 In November, the pizzeria budgeted for 1,950 pizzas at an average selling price of $20 per pizza and for 190 dellveries Data concerning the pizzeria's actual results in November appear below Actual Results Pizzas Deliveries 2,050 170 Revenue S 41,680 Pizza ingredients Kitchen staff Utilities Delivery person 9,550 6,110 950 578

Answer 1

	Milano Pizza
	Flexible Budget Performance Report
	For the Month Ended November 30
	Actual Results	Revenue and spending variances		Flexible Budget	Activity variances		Planning Budget
Pizzas	2050			2050			1950
Deliveries	170			170			190
Revenue	41680	680	F	41000	2000	F	39000
Expenses:
Pizza ingredients	9550	120	U	9430	460	U	8970
Kitchen staff	6110	60	F	6170	0	None	6170
Utilities	950	1020	F	1970	60	U	1910
Delivery person	578	0	None	578	68	F	646
Delivery vehicle	1012	20	F	1032	32	F	1064
Equipment depreciation	504	0	None	504	0	None	504
Rent	2130	0	None	2130	0	None	2130
Miscellaneous	868	402	F	1270	20	U	1250
Total expense	21702	1382	F	23084	440	U	22644
Net operating income	19978	2062	F	17916	1560	F	16356