Reference no: EM133081176

Question - Case Study - "We budgeted only $5,000 for labor last week," said Cindy, the manager of Villa Park Country Club. "But our payroll report from accounting said we spent over $6,000 last week. We've got to cut back!"

"But that doesn't make any sense," said Sandy, the club's grill manager. "We had a great week last week. It was sunny every day and the golfers were out in droves. I think we had the best sales week we have had all year. Our revenue was way higher than expected, too!"

"Is that why you had so much overtime?" asked Cindy. "Accounting said we used a ton of overtime."

"We did have some overtime," replied Sandy. "I didn't send anyone home early all week, and on several days the production crew stayed late to prep extra for the next day. I also had to call in extra servers on both Friday and Saturday."

"Well," replied Cindy, "I understand, but accounting still said you were way over budget on our payroll. What are you going to do now?"

1. Do you think Sandy showed good judgment by increasing staffing in response to the increase in volume? Would you have done anything differently?

2. What are some reasons managers might spend more money than they originally budgeted in a specific time period? What are some reasons they might spend less money?