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 $5,910 $ 610 $ 0.30 Pizza ingredienta Kitchen state Utilities Delivery person Delivery vehele Tiquipment depreciation Rent Miscellaneous $3.10 $1.50 $ 630 $ 400 $1.870 $ 730 0.15 In November, the pizzeria budgeted for 1,560 pizzas at an average selling price of $15 per pizza and for 220 deliveries. Data concerning the pizzeria's actual results in November appear below. Metaal Resulte 1,660 200 25,650 $ 7.210 $ 5.50 Deliveries Revenue Pas ingrediente Kitchen start lit Delivery person Delivery vehicle Equipment depreciation 620 $ $ 400 1.070 Millance

Answer 1

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Milano Pizza	Flexible budget for 1,660 pizzas and 200 deliveries
	Per unit	Variable amount	Fixed Cost	Total cost	Remarks
No. of Pizzas	1,660.00
No. of Deliveries	200.00
Sales	15.00	24,900.00		24,900.00	It is calculated as $ 15* 1,660 units.
Pizza Ingredients	4.40	7,304.00		7,304.00	It is calculated as $ 4.4* 1,660 units.
Kitchen Staff			5,910.00	5,910.00	It is a fixed cost and does not change with units.
Utilities	0.30	498.00	610.00	1,108.00	It is calculated as $ 0.30* 1,660 units. $ 610 is a fixed cost and does not change with units.
Delivery Person	3.10	620.00		620.00	It is calculated as $ 3.10* 200 deliveries.
Delivery Vehicle	1.50	300.00	630.00	930.00	It is calculated as $ 1.50* 200 deliveries. $ 300 is a fixed cost and does not change with deliveries.
Equipment Depreciation			400.00	400.00	It is a fixed cost and does not change with units.
Rent			1,870.00	1,870.00	It is a fixed cost and does not change with units.
Miscellaneous	0.15	249.00	730.00	979.00	It is calculated as $ 0.15* 1,660 units. $ 730 is a fixed cost and does not change with units.
Total		8,971.00	10,150.00	19,121.00
Answer 1
	Actual	Flexible Budget	Revenue and Spending Variance	Remarks
Pizzas	1,660.00	1,660.00
Deliveries	200.00	200.00
Revenue	25,450.00	24,900.00	550.00	Favorable
Expenses
Pizza Ingredients	7,210.00	7,304.00	(94.00)	Favorable
Kitchen Staff	5,850.00	5,910.00	(60.00)	Favorable
Utilities	885.00	1,108.00	(223.00)	Favorable
Delivery Person	620.00	620.00	-	None
Delivery Vehicle	986.00	930.00	56.00	Unfavorable
Equipment Depreciation	400.00	400.00	-	None
Rent	1,870.00	1,870.00	-	None
Miscellaneous	790.00	979.00	(189.00)	Favorable
Total Expenses	18,611.00	19,121.00	(510.00)	Favorable
Net Operating Income	6,839.00	5,779.00	1,060.00	Favorable