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Question - Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria's owner has determined that the shop has two major cost drivers-the number of pizzas sold and the number of deliveries made.
The pizzeria's cost formulas appear below:
Fixed Cost per Month
Cost per Pizza
Cost per Delivery
Pizza ingredients
$4.50
Kitchen staff
$5,930
Utilities
$620
$0.40
Delivery person
$3.20
Delivery vehicle
$640
$1.60
Equipment depreciation
$408
Rent
$1,890
Miscellaneous
$740
$0.20
In November, the pizzeria budgeted for 1,590 pizzas at an average selling price of $16 per pizza and for 230 deliveries.
Data concerning the pizzeria's actual results in November were as follows:
Actual Results
Pizzas
1,690
Deliveries
210
Revenue
$27,600
$7,390
$5,870
$890
$672
$988
$796
Required - Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November.
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