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The Stuart Management Association held its annual public relations luncheon in April 2017. Based on the previous year's results, the ted $29,010 of its operating budget to cover the cost of the luncheon. To ensure that costs would be appropriately controlled, Molly Hubbard, the treasurer, prepared the following budget for the 2017 luncheon. The budget for the luncheon was based on the following expectations. 1. The meal cost per person was expected to be $13.30. The cost driver for meals was attendance, which was expected to be 1,550 individuals 2. Postage was based on $0.74 per invitation and 3,750 invitations were expected to be mailed. The cost driver for postage was number of invitations mailed 3. The facility charge is $2,500 for a room that will accommodate up to 1,700 people; the charge for one to hold more than 1,700 people is $3,000 4. Afixed amount was designated for printing, decorations, the speaker's gift, and publicity. STUART MANAGEMENT ASSOCINION Public Relations Luncheon Budget April 2017 Operating funds allocated $29,010 Expenses Variable costs Meals (1,550 $13.30) 20,615 Postage (3.750 0.74) 2.775 Fixed costs Tacility 2.500 Printing 1. 100 Decorations blicity Total expenses budget surplus deficit) Actual results for the luncheon follow STUART MANAGEMENT ASSOCIATION Actual Results for Public Relations Luncheon April 2017 Operating funds allocated $29,010 Expenses Variable costs Meals (1,770 * $14.00) 24,780 Postage (4,750 X 0.74) 3,515 Fixed costs Pacility 3,000 Printing 1.100 Decorations 990 Speaker's gift 280 Publicity 750 Total expenses 34.415 Budget deficit $(5,405) Reasons for the differences between the budgeted and actual data follow. 1. The president of the organization, Zachary Taylor, increased the invitation list to include 1.000 former members. As a result, 4.750 Invitations were mailed 2. Attendance was 1770 individuals. Because of higher than expected attendance, the luncheon was moved to a larger room, thereby increasing the facility charge to $3.000 3. At the last minute. Ms. Cole decided to add a dessert to the menu, which increased the meal cost to $14.0 per person 4. Printing decorations, the speaker's gift, and publicity costs were as budgeted. Required: a. Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget b. Compute flexible budget variances by comparing the flexible budget with the actual results Complete this question by entering your answers in the tabs below. Required A Required B Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect i.e., zero variance).) Flexible Budget = Volume Variance Master Budget . Allocated funds $ 29,010 Expenses Variable expenses Meals 20,615 Postage : 2,775 Fixed expenses Facility 2,500 Printing 1.100 Decorations 990 Speaker's gift 280 Publicity 750 Total expenses 29,010 Surplus de 0 Required > Complete this question by entering your answers in the tabs below. Required A Required B Compute flexible budget variances by comparing the flexible budget with the actual results. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect i.e., zero variance).) Flexible Budget = Flexible Variances - Actual Results $ 29,010 Allocated funds Expenses Variable costs: Meals 24.780 3,515 1 Postage Fixed costs Facility Printing Decorations Speaker's gift Publicity Total expenses Surplus deficit) 3.000 1,100 990 280 750 34 415 (5.405)

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