Question

City Band expected to hold 20 concerts during its last summer concert season and pay an average of 60 musicians $5 per concert for their performances. At the end of the summer, the band had only been able to perform 16 times. The other four performances were rained out. Because of the shortened concert season, the trustees decided to pay the musicians who came to the concerts $6 per performance. On average, 55 musicians were at each performance. Question 5. Calculate City Band's total musicians' stipend expense variance for the season. Indicate whether that variance was favorable or unfavorable. Calculate the portion of that variance that was due to volume. Indicate whether that variance was favorable or unfavorable. Calculate the portion of that variance that was due to quantity. Indicate whether that variance was favorable or unfavorable. Calculate the portion of that variance that was due to the rate paid to the musicians. Indicate whether that variance was favorable or

Answer 1

Particulars No. of Concerts Musicians per Concert Budget Actual 20 60 16 Musician Concert (Volume 1200 880 Rate 5 (Budgeted Rate Budgeted Volume) (Actual Rate * Actual Volume) ($5 per concert per musician *20 Concerts *60 Musician)-($ 6 per concert per musician 16 Concerts *55 Musician) ( $ 6,000- $5,280) $720 Favourable Total Variance Total Rate Variance (Budgeted Rate - Actual Rate)* Actual Volume issper conetprmsitan- 56per concert per musican) 80 Mucican Concert -$-880 Un- Favourable Total Volume Variance (Budgeted Volume Actual Volume) Budgeted Rate -(1200 Musician Concert- 880 Musician Concert) *$6 per concert per musician -$1600 Favourable