INI100H1 Lecture Notes - The Impossible Voyage
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The Little Theatre is a nonprofit organization devoted tostaging plays for children. The Theatre has a very small full-timeprofessional administrative staff. Through a special arrangementwith the actorsâ union, actors and directors rehearse without payand are paid only for actual performances. |
The costs from the current yearâsplanning budget appear below. The Little Theatre had tentativelyplanned to put on six different productions with a total of 50performances. For example, one of the productions was PeterRabbit, which had a six-week run with three performances oneach weekend. |
The Little Theatre Costs from the Planning Budget For the Year Ended December 31 | ||
Budgeted number ofproductions | 6 | |
Budgeted number ofperformances | 50 | |
Actorsâ anddirectorsâ wages | $ | 105,000 |
Stagehandsâwages | 20,500 | |
Ticket boothpersonnel and ushersâ wages | 11,500 | |
Scenery, costumes,and props | 48,600 | |
Theatre hallrent | 35,500 | |
Printedprograms | 11,250 | |
Publicity | 12,600 | |
Administrativeexpenses | 46,000 | |
Total | $ | 290,950 |
Some of the costs vary with the numberof productions, some with the number of performances, and some arefixed and depend on neither the number of productions nor thenumber of performances. The costs of scenery, costumes, props, andpublicity vary with the number of productions. It doesnât make anydifference how many times Peter Rabbit is performed, thecost of the scenery is the same. Likewise, the cost of publicizinga play with posters and radio commercials is the same whether thereare 10, 20, or 30 performances of the play. On the other hand, thewages of the actors, directors, stagehands, ticket booth personnel,and ushers vary with the number of performances. The greater thenumber of performances, the higher the wage costs will be.Similarly, the costs of renting the hall and printing the programswill vary with the number of performances. Administrative expensesare more difficult to pin down, but the best estimate is thatapproximately 70% of the budgeted costs are fixed, 15% depend onthe number of productions staged, and the remaining 15% depend onthe number of performances. |
After the beginning of the year, theboard of directors of the Theatre authorized expanding theTheatreâs program to five productions and a total of 54performances. Not surprisingly, actual costs were considerablyhigher than the costs from the planning budget. (Grants from donorsand ticket sales were also correspondingly higher, but are notshown here.) Data concerning the actual costs appear below: |
The Little Theatre Actual Costs For the Year Ended December 31 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual number ofproductions | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual number ofperformances | 54 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actorsâ anddirectorsâ wages | $ | 109,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stagehandsâwages | 22,100 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Ticket boothpersonnel and ushersâ wages | 13,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Scenery, costumes,and props | 44,900 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Theatre hallrent | 40,100 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Printedprograms | 11,700 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Publicity | 11,600 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Administrativeexpenses | 44,450 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 296,850 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Stevens Center is a nonprofit organization devoted its stagingplays for children. The theater has a very small | ||||||
full-time professional administrative staff. Through a specialarrangement with the actors' union, actors | ||||||
and directors rehearse without pay and are paid only for actualperformances. | ||||||
The costs from the current year's planning budget appear below.Steven Center had tentatively planned to put | ||||||
on six different productions with a total of 108 performances.For example, one of the productions was The Lion King, | ||||||
which has a six-week run with three performances on eachweekend. | ||||||
Stevens Center | ||||||
Costs from the Planning Budget | ||||||
For the Year Ended December 31 | ||||||
Budgeted number of productions | 6 | |||||
Budgeted number of performances | 108 | |||||
Actors' and directors' wages | $215,000 | |||||
Stagehands' wages | 31,900 | |||||
Ticket booth personnel and ushers' wages | 16,400 | |||||
Scenery, costumes, and props | 107,900 | |||||
Theater hall rent | 53,000 | |||||
Printed programs | 26,800 | |||||
Publicity | 12,200 | |||||
Administrative expense | 44,200 | |||||
Total | $507,400 | |||||
Some of the costs vary with the number of productions, some withthe number of performances, and | ||||||
some are fixed and depend on neither the number of productionsnor the number of performances. | ||||||
The costs of scenery, costumes, props, and publicity vary withthe number of productions. | ||||||
It doesn't make any differences how many times The Lion King isperformed, the cost of the | ||||||
scenery is the same. Likewise, the cost of publicizing a playwith posters and radio commericals is the | ||||||
same whether there are 10,20 or 30 performances of the play. Onthe other hand, the wages of | ||||||
the actors, directors, stagehands, ticket booth personnel, andushers vary with the number of | ||||||
perofrmances. The greater the number of performances, the higherthe wage costs will be. Similarily, | ||||||
the costs of renting the hall and printing the programs willvary with the number of performances. | ||||||
Administrative expenses are more difficult to pin down, but thebest estimate is that approximately | ||||||
75% of the budgeted costs are fixed, 15% depend on the number ofproductions staged, and the | ||||||
remaining 10% depend on the number of performances. | ||||||
After the beginning of the year, the board of directors of thetheater authorized expanding the | ||||||
theater's program to seven productions and a total of 168performances. Not surprisingly, actual | ||||||
costs were considerably higher than the costs from the planningbudget. (Grants from donors | ||||||
and ticket sales were also correspondingly higher, but are notshown here.) Data concerning the | ||||||
actual costs appear below: | ||||||
Stevens Center | ||||||
Costs from the Planning Budget | ||||||
For the Year Ended December 31 | ||||||
Actual number of productions | 7 | |||||
Actual number of performances | 168 | |||||
Actors' and directors' wages | $341,600 | |||||
Stagehands' wages | 49,500.00 | |||||
Ticket booth personnel and ushers' wages | 25,800.00 | |||||
Scenery, costumes, and props | 130,700.00 | |||||
Theater hall rent | 78,100.00 | |||||
Printed programs | 38,400.00 | |||||
Publicity | 15,200.00 | |||||
Administrative expense | 47,100.00 | |||||
Total | $726,400 | |||||
1. Prepare a flexible budget for the Stevens Center based on theactual activity of the year. | ||||||
2. Prepare a flexible budget performance report for the yearthat shows both spending variance | ||||||
and activity variances. | ||||||
Stevens Theater | ||||||
Flexible Budget Performance Report | ||||||
For the Year Ended December 31 | ||||||
Actual Results | Spending Variances | Flexible Budget | Activity Variances | Planning Budget | ||
Actual number of productions | 7 | |||||
Actual number of performances | 168 | |||||
Actors' and directors' wages | $341,600 | |||||
Stagehands' wages | 49,500.00 | |||||
Ticket booth personnel and ushers' wages | 25,800.00 | |||||
Scenery, costumes, and props | 130,700.00 | |||||
Theater hall rent | 78,100.00 | |||||
Printed programs | 38,400.00 | |||||
Publicity | 15,200.00 | |||||
Administrative expense | 47,100.00 | |||||
Total | $726,400 | |||||
3. If you were on the board of directors of the theater, wouldyou be pleased with how | ||||||
costs were controlled during the year? Why or why not? | ||||||
4. The cost formula provide figures for the average cost perproduction and average cost per performance. | ||||||
How accurate do you think these figures would be for predictingthe cost of a new production or of an additiional performance of aparticular production? | ||||||
Stevens Center isa nonprofit organization devoted its staging plays for children.The theater has a very small | ||||||
full-time professionaladministrative staff. Through a special arrangement with theactors' union, actors | ||||||
and directors rehearse withoutpay and are paid only for actual performances. | ||||||
The costs from the currentyear's planning budget appear below. Steven Center had tentativelyplanned to put | ||||||
on six different productionswith a total of 108 performances. For example, one of theproductions was The Lion King, | ||||||
which has a six-week run withthree performances on each weekend. | ||||||
StevensCenter | ||||||
Costs from the PlanningBudget | ||||||
For the Year Ended December31 | ||||||
Budgeted number of productions | 6 | |||||
Budgeted number of performances | 108 | |||||
Actors' and directors' wages | $215,000 | |||||
Stagehands' wages | 31,900 | |||||
Ticket booth personnel and ushers'wages | 16,400 | |||||
Scenery, costumes, and props | 107,900 | |||||
Theater hall rent | 53,000 | |||||
Printed programs | 26,800 | |||||
Publicity | 12,200 | |||||
Administrative expense | 44,200 | |||||
Total | $507,400 | |||||
Some of the costs vary withthe number of productions, some with the number of performances,and | ||||||
some are fixed and depend onneither the number of productions nor the number ofperformances. | ||||||
The costs of scenery,costumes, props, and publicity vary with the number ofproductions. | ||||||
It doesn't make anydifferences how many times The Lion King is performed, the cost ofthe | ||||||
scenery is the same. Likewise,the cost of publicizing a play with posters and radio commericalsis the | ||||||
same whether there are 10,20or 30 performances of the play. On the other hand, the wagesof | ||||||
the actors, directors,stagehands, ticket booth personnel, and ushers vary with the numberof | ||||||
perofrmances. The greater thenumber of performances, the higher the wage costs will be.Similarily, | ||||||
the costs of renting the halland printing the programs will vary with the number ofperformances. | ||||||
Administrative expenses aremore difficult to pin down, but the best estimate is thatapproximately | ||||||
75% of the budgeted costs arefixed, 15% depend on the number of productions staged, and the | ||||||
remaining 10% depend on thenumber of performances. | ||||||
After the beginning of theyear, the board of directors of the theater authorized expandingthe | ||||||
theater's program to sevenproductions and a total of 168 performances. Not surprisingly,actual | ||||||
costs were considerably higherthan the costs from the planning budget. (Grants from donors | ||||||
and ticket sales were alsocorrespondingly higher, but are not shown here.) Data concerningthe | ||||||
actual costs appear below: | ||||||
StevensCenter | ||||||
Costs from the PlanningBudget | ||||||
For the Year Ended December31 | ||||||
Actual number of productions | 7 | |||||
Actual number of performances | 168 | |||||
Actors' and directors' wages | $341,600 | |||||
Stagehands' wages | 49,500.00 | |||||
Ticket booth personnel and ushers'wages | 25,800.00 | |||||
Scenery, costumes, and props | 130,700.00 | |||||
Theater hall rent | 78,100.00 | |||||
Printed programs | 38,400.00 | |||||
Publicity | 15,200.00 | |||||
Administrative expense | 47,100.00 | |||||
Total | $726,400 | |||||
1. Prepare a flexible budgetfor the Stevens Center based on the actual activity of theyear. | ||||||