Via Gelato is a popular neighborhood gelato shop. The company has provided the f
ID: 2411115 • Letter: V
Question
Via Gelato is a popular neighborhood gelato shop. The company has provided the following data concerning its operations:
While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $6,400 plus $2.20 per liter of gelato sold and the actual wages for June were $20,200. Via Gelato expected to sell 6,300 liters in June, but actually sold 6,500 liters.
Complete the report showing Via Gelato revenue and spending variances for June. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
FixedElement
per Month Variable
Element
per Liter Actual
Total for
June Revenue $ 20.00 $ 122,540 Raw materials $ 5.45 $ 36,030 Wages $ 6,400 $ 2.20 $ 20,200 Utilities $ 2,430 $ 1.00 $ 9,100 Rent $ 3,400 $ 3,400 Insurance $ 2,150 $ 2,150 Miscellaneous $ 730 $ 1.15 $ 8,050
While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example, wages should be $6,400 plus $2.20 per liter of gelato sold and the actual wages for June were $20,200. Via Gelato expected to sell 6,300 liters in June, but actually sold 6,500 liters.
Complete the report showing Via Gelato revenue and spending variances for June. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
Via Gelato Revenue and Spending Variances For the Month Ended June 30 Revenue Expenses: Raw materials Wages Utilities Rent Insurance Miscellaneous Total expense Net operating incomeExplanation / Answer
Explanation Via Gelato Revenue and Spending Variances For the Month Ended June 30 Actual Results Flexible Budget Revenue and Spending Variances Pounds 6500 6500 Revenue 122,540 130000 7,460 U Expenses Packing Supplies 36,030 35425 605 U Oyster bed maintenance 20,200 20,700 500 F Wages and salaries 9,100 8,930 170 U Shipping 3,400 3,400 0 None Utilities 2,150 2,150 0 None Other 8,050 8,205 155 F Total expense 78930 78810 120 U Net operating income 43610 51190 7,580 U Revenue 20*6500 130000 Via Gelato Revenue and Spending Variances For the Month Ended June 30 Revenue 7,460 U Expenses Packing Supplies 605 U Oyster bed maintenance 500 F Wages and salaries 170 U Shipping 0 F Utilities 0 F Other 155 U Total expense 120 U Net operating income 7,580 U
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