90.2K

Verified Solution

Link Copied!

Gelato Supremo is a popular neighborhood gelato shop. The company has provided the following data concerning its operations:

	Fixed Element per Month		Variable Element per Liter		Actual Total for July
Revenue			$	14.20	$	79,950
Raw materials			$	4.50	$	26,210
Wages	$	4,800	$	1.10	$	11,250
Utilities	$	1,860	$	0.10	$	2,272
Rent	$	3,190			$	3,190
Insurance	$	1,870			$	1,870
Miscellaneous	$	510	$	0.10	$	1,166

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 $4,800 plus $1.10 per liter of gelato sold, and the actual wages for July were $11,250. Gelato Supremo expected to sell 5,500 liters in July, but actually sold 5,400 liters.

Required:

Prepare a report showing Gelato Supremo revenue and spending variances for July. (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

Gelato Supremo Revenue and Spending Variances For the Month Ended July 31
	Flexible Budget	Actual Results	Revenue and Spending Variances
Revenue	$	$	$	(Click to select)UFNone
Expenses:
Raw materials				(Click to select)FUNone
Wages				(Click to select)UFNone
Utilities				(Click to select)FUNone
Rent				(Click to select)NoneUF
Insurance				(Click to select)UNoneF
Miscellaneous				(Click to select)UNoneF
Total expense				(Click to select)FUNone
Net operating income	$	$	$	(Click to select)FUNone

Answer & Explanation Solved by verified expert

See Answer