Case Study 3 Week 7
The Little Theatre is a nonprofitorganization devoted to staging plays for children. The theatre has a very small full-time professional administrative staff. Through a rangement with the actors union, actors and directors rehearse wi out pay and are paid only for actual special a The costs from the current year's planning budget appear below. The Little Theatre had tentatively planned to put on four different productions with a total of 60 performances For example, one of the productions was Peler Rabbir, which had a six-week run th three performances on each weekend. The Little Theatre Costs fram the Planning Budget For the Year Ended December 3 Budgeted number of productions Budgeted number of performances $162,000 Actors and directors Wages Stagehands' wages 28.200 Ticket booth personnel and ushers wages Scenery, costumes, and props Theatre hall rent Printed program 5.300 46.000 Administrative expenses Some of the costs vary with the number of productions, some with the number of performances, and some are fixed and depend on neither the number of productions nor the number of performances. The costs of scenery, costumes, props, and publicity vary with the number of productons. It doesn't make any difference how many times PotorRabbitis performed, the cost of the scenery is the same. Likewise, the cost of publicizing a play with posters and radio commercials is the same whether there are 10, 20, or 30 performances of the play. On the other hand, the wages of the actors, directors, stagehan ds, ticket booth personnel, and ushers vary wth the number of performances. The greater the number of perfomances, the higher the wage costs will be. Similarly, the costs of renting the hall and printing the programs ill vary with the number of pe rfonmances. Administrative expenses are more difficult to pin down, but the best estimate is that approximately 75% of the budgeted costs are fixed, 10% depend on the number of productions staged, and the remaining 15% depend on the number of After the beginning of the year, the board of directors of the theatre authorized expanding the theatre's program to three productions and a total of 64 performances. Not surprisingly, actual costs were considerably higher than the costs from the planning budget. (Grants from donors and licket sales were also correspondingly higher, but are not shown here)Data conceming the actual costs appear below: The Little Theatre Actual Costs For the Yoar Ended December 3 Actual number of productions Actual number of performances $168,000 Actors and directors Stagehands' wages 29.800 Ticket booth personnel and ushers wages Scenery, costumes, and props Theatre hall rent Printed program 9A00 Administrative expenses 44,450 Required 1. Complete the flexible budget for The Little Theatre based on the actual activity of the year.