Prepare flexible budget for the diner

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Reference no: EM133017329

Question: Gamon Memorial Diner is a charity supported by donations that provides free meals to the homeless. The diner's manager has just submitted the report presented below, which compares the diner's budget for February to the actual costs for February. The diner's manager was very happy about the results because total actual costs were less than budgeted.

Cost category and budget assumptions Budget 3,600 meals Actual 3,200 meals Flexible Budget
Groceries ($2.05 per meal) $ 7,380 $ 8,132

Kitchen operations ($4,700 + $1.15 per meal) 8,840 8,350

Inspections and sanitizing ($500 per week) 2,000 1,500

Administrative expenses ($2,700 + $0.70 per meal) 5,220 4,960

Fundraising expenses ($1,700 per month) 1,700 1,400

Total costs $ 25,140 $ 24,342

Prepare flexible budget for the diner in the space provided above.

As a highly trained MBA, do you share the joy of the diner's manager? (circle yes or no below) YES NO

Which two variances would you investigate? Name the expense and BRIEFLY state why it would be important to investigate.

Reference no: EM133017329

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