Via Gelato is a popular neighborhood gelato shop. The company has provided the f

Question

Via Gelato is a popular neighborhood gelato shop. The company has provided the following data concerning its operations Fixed Variable Actual Element Element Total for per Month per Liter June Revenue Raw materials Wages Utilities Rent Insurance Miscellaneous $20.00$122,540 $ 5.45 $ 36,030 $6,400 $ 2.20$ 20,200 $2,430 $ 1.00 $ 9,100 $ 3,400 $ 2,150 $ 730 1.15 $ 8,050 $3,400 $2,150 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 Required 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 5,460 Expenses 605 500 F 170 Raw materials Wages Utilities Rent Insurance Miscellaneous 0 None 0 None 155 F lotal expense Ul Net operating income

Explanation / Answer

Compute Revenue and spending variance ;

Actual results Flexible budget Revenue and spending variance Revenue 122540 130000 7460 U Expenses Raw material 36030 35425 605 U Wages 20200 20700 500 F Utilities 9100 8930 170 U Rent 3400 3400 None Insurance 2150 2150 None Miscellaneous 8050 8205 155 F Total expense 78930 78810 120 U Net operating income 43610 51190 7580 U

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