Chapter 9 Discussion Topic

Chapter 9 Discussion Topic - shows 2 The cost formulas...

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1. If you were on the board of directors of the theater, would you be pleased with how well costs were controlled during the year? Why or why not? Yes, I would be very pleased with how well costs were controlled during the year. In the vast majority of the expense categories, the actual costs were less than the budgeted costs. The per performance budgeted cost was a total of $5,608.33, while the per performance actual cost was a total of $5,350.00. If all other things are equal (ticket sales per performance, ticket prices, etc.), The Munchkin Theater made about $258.00 more per performance than was budgeted, while putting on an additional four
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Unformatted text preview: shows. 2. The cost formulas provide figures for the average cost per production and average cost per performance. How accurate do think these figures would be for predicting the cost of a new production or of an additional performance of a particular production? Since the variable expenses vary by performance, I think you could accurately predict the cost of additional productions and performances. A new production may have some unforeseen costs, causing it to not be as accurately predicted, but the theater should be able to very accurately predict the cost of additional performances of the shows they are already running....
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