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 Costper Month Cost perPizza Cost perDelivery Pizza ingredients       $ 4.70         Kitchen staff $ 5,970               Utilities $ 640   $ 0.60         Delivery person             $ 3.40   Delivery vehicle $ 660         $ 1.80   Equipment depreciation $ 424               Rent $ 1,930               Miscellaneous $ 760   $ 0.06                In November, the pizzeria budgeted for 1,650 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 Pizzas   1,750   Deliveries   230           Revenue $ 32,080   Pizza ingredients $ 7,750   Kitchen staff $ 5,910   Utilities $ 900   Delivery person $ 782   Delivery vehicle $ 992   Equipment depreciation $ 424   Rent $ 1,930   Miscellaneous $ 808       Required: 1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

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Chapter1: Financial Statements And Business Decisions
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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
Cost per
Delivery
Pizza ingredients       $ 4.70        
Kitchen staff $ 5,970              
Utilities $ 640   $ 0.60        
Delivery person             $ 3.40  
Delivery vehicle $ 660         $ 1.80  
Equipment depreciation $ 424              
Rent $ 1,930              
Miscellaneous $ 760   $ 0.06        
   

  

In November, the pizzeria budgeted for 1,650 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
Pizzas   1,750  
Deliveries   230  
       
Revenue $ 32,080  
Pizza ingredients $ 7,750  
Kitchen staff $ 5,910  
Utilities $ 900  
Delivery person $ 782  
Delivery vehicle $ 992  
Equipment depreciation $ 424  
Rent $ 1,930  
Miscellaneous $ 808  
 

 

Required:

1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

 

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