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Calculate may cost variance for housekeeping labour

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Reference no: EM133172038

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Q1. Squeaky Bear Poutine is a popular late-night take-out restaurant. The owner budgets to sell each classic poutine for $10. She budgets to sell 1,500 classic poutines per month and spend $4,500 on food. Due to road construction in front of the location in June, she only sells 1,000 classic poutines at a cost of $3.50 each, earning $9,500 in revenue. Required

a) Calculate the total static budget variance.

b) Calculate the total sales-volume variance.

c) Calculate the total flexible budget variance.

d) Explain the flexible budget variance.

e) Explain some possible reasons for the flexible budget variance.

f ) Calculate the sales price variance.

g) Calculate the cost variance.

Q2. Tara is the housekeeping department manager at Hotel Hutchinson, and she requires your assistance analyzing the department's labour cost variances for the month of May. The hotel sold 930 rooms in May. The hotel budgets to take 45 minutes cleaning each room and to pay housekeepers $18 per hour. Time sheets for May show 744 housekeeping hours incurred for a total cost of $12,648.

a) Calculate May's flexible budget variance for housekeeping labour.

b) Calculate May's cost variance for housekeeping labour.

c) Calculate May's quantity variance for housekeeping labour.

d) Explain the flexible budget variance to Tara.

e) Tara has asked you to provide some strategies to avoid a similar variance in June.

Q3. Hotel Lady MacDonald budgeted to sell 3,000 rooms for $200 each in March. It actually sold 3,100 rooms at an average rate of $190. Calculate the following figures.

a) Static budget revenue

b) Flexible budget revenue

c) Actual revenue

d) Flexible budget variance

e) Sales-volume variance

Reference no: EM133172038

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