Compute the revenue and spending variances

Assignment Help Managerial Accounting

Reference no: EM133342132

Case: 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				$	4.80
Kitchen staff	$	6,210
Utilities	$	760		$	0.80
Delivery person						$	2.60
Delivery vehicle	$	780				$	1.80
Equipment depreciation	$	520
Rent	$	2,170
Miscellaneous	$	880		$	0.20

In November, the pizzeria budgeted for 2,010 pizzas at an average selling price of $14 per pizza and for 210 deliveries.

Data concerning the pizzeria's actual results in November appear below:

	Actual Results
Pizzas		2,110
Deliveries		190

Revenue	$	30,240
Pizza ingredients	$	9,910
Kitchen staff	$	6,150
Utilities	$	960
Delivery person	$	494
Delivery vehicle	$	1,016
Equipment depreciation	$	520
Rent	$	2,170
Miscellaneous	$	880

Required:

1. Compute the revenue and spending variances for the pizzeria for November

Reference no: EM133342132

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