# Were any of the variances favorable?

The director of Show more Financial Management Homework Assignment #3 Dearborn Center for the Performing Arts The director of the Dearborn Center for the Performing Arts has asked you to prepare a variance report comparing the centers budgeted and actual revenues expenses and profits for FY 2015. a)In the variance column of the Excel template calculate each variance in dollars. Remember that favorable variances should be positive numbers and unfavorable variances should be negative numbers. b)In the U/F column label unfavorable variances U and favorable variances F using an IF formula. For the revenue ticket sales the formula would be: =IF(E7>=0FU). c)Use conditional formatting to make the Us red. Select cells F7:F25 then choose conditional formatting then highlight cell rules > text that contains then enter U. From the Format with drop down menu select red text and press OK. The Dearborn Centers director wants to know why the center spent more on program printing than anticipated in FY 2015. Use the following information to help her answer this question. The budget was based on the assumption that the center would put on 225 performances throughout the year but it actually put on 217 performances. The expected cost of printing was 50 cents per program but the actual cost was 60 cents per program. The center gives one program to each patron. (Hint: use the information in this question and in the variance report to find the budgeted and actual numbers of programs.) Calculate the volume quantity price and total variances and then label each variance U or F. Use the information in the variance analysis to respond to the following prompts: a)Write a sentence explaining the quantity variance without using financial jargon. b)Which variance most contributed to the unfavorable total variance? How do you know? c)Were any of the variances favorable? If yes explain why the variance(s) is/was favorable. The Dearborn Center puts on two types of performances: theatrical and musical. The director is trying to estimate the annual cost of the theatrical performances. Several costs are attributable directly to one type of performance or the other. For the theatrical performances equipment rental costs $22500 advertising costs $19000 and program printing costs $17640. The same personnel including performers staff and crew work on both the theatrical and musical performances. The total cost of salaries and wages for personnel was $753165. In total personnel spent 4000 person hours on the theatrical performances and 6000 person hours on the musical performances. Rent and utilities cost $166840 in total. There were 140 theatrical performances and 77 musical performances. Calculate the total annual cost of the theatrical performances. Use person hours as the cost base for allocating personnel salaries and wages and number of performances as the cost base for allocating rent and utilities. Do the reading assignment for the next class (Chapter 5 up to p. 176 Appendices 5-A and 5-B Excel & Calculator Tips 2 handout and New York State Lottery handout) and then answer the following reading comprehension questions: a)The director is considering reupholstering the theaters seats. She says that since the reupholstered seats would last 10 years and would yield an additional $10000 in revenues per year she should be willing to pay up to $100000 for the renovation. Does her argument make sense? Why or why not? (You do not need to do any calculations.) b)The director has a choice of investing the theaters funds at an annual interest rate of 4% compounded semiannually or quarterly. Which should she choose and why? Dearborn Center for the Performing Arts Dearborn Center for the Performing Arts Dearborn Center for the Performing Arts Dearborn Center for the Performing Arts Dearborn Center for the Performing Arts Variance Report Variance Report Variance Report Variance Report Variance Report FY 2015 FY 2015 FY 2015 FY 2015 FY 2015 Budget Actual Variance U/F Earned revenue Ticket sales 825000 863850 Contributed revenue Foundations 200500 192852 Corporations 160000 173966 Individuals 225000 209475 Total revenue 1410500 1440143 Expenses Performer fees 304500 317890 Staff salaries 279000 283275 Crew salaries 158000 152000 Rent 122500 122500 Utilities 42250 44340 Equipment rental 50000 51233 Advertising 37750 32862 Program printing 21375 27342 Total expenses 1015375 1031442 Profit/(Loss) 395125 408701 Variance Analysis Variance Analysis Variance Analysis Variance Analysis Variance Analysis Volume x Quantity x Price = Total Original Budget Volume Variance Volume Variance Flex Budget Quantity Variance Quantity Variance VQA Budget Price Variance Price Variance Actual Costs Total Variance Total Variance (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2a) Write a sentence explaining the quantity variance without using financial jargon: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2b) Which variance most contributed to the unfavorable total variance? How do you know?: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: (2c) Were any of the variances favorable? If yes explain why the variance(s) was/were favorable: Show less