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The Houston Chamber Orchestra presents a series of concerts throughout the year. Budgeted fixed costs total $300,000 for the concert season; variable costs are expected to average $5 per patron. The orchestra uses flexible budgeting.
Required:A. Prepare a flexible budget that shows the expected costs of 8,000, 8,500, and 9,000 patronsB. Construct the Orchestra's flexible budget formula.C. Assume that 8,700 patrons attended concerts during the year just ended, and actual costs were; variable, $42,000; fixed, $307,500. Evaluate the orchestra's financial performacne by computing variances for variable costs and fixed costs.
Any help or suggestions would be greatly appreciated.
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