The Kalamazoo Zoo Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

The Kalamazoo Zoo Case Solution

Question 1

The revenues have favorable variance of $30,000.

The Expenditure Variance is unfavorable with $250,000.

Variance Type	Actual	Budget	Variance	Favorable/Unfavorable
Revenue Variance	850000	820000	30000	Favorable
Expenditure Variance	1070000	820000	250000	Unfavorable

Question 2

As per the revenue quantity variance, the actual quantity is that the actual visitors were less than expected,thus this causes variance of $40,000 which is unfavorable.

However, the ticketing prices charged were higher than the budgeted, which gives favorable variance of $20,000.

It can also be interpreted that the higher ticket prices might cause reduction in the expected visitors and the overall effect of this is unfavorable.

This analysis can further be interpreted that the zoo should maintain ticketing prices at a certain level so that it can attract more customers. The increase in the number of customers will have high favorable effect than the increase in the prices. Overall, it can be concluded that the increased prices resulted in less visitors and thus, less revenue for the zoo. Moreover, as per the facts of the case the weather conditions might also prevent visitors from visiting the zoo.

Ticketing
Revenue Variance	Actual Quantity	Budgeted Quantity	Budgeted Price	Variance	Favorable/Unfavorable
Quantity	10000	15000	8	-40000	Unfavorable


Revenue Variance	Actual Price	Budgeted Price	Actual quantity	Variance	Favorable/Unfavorable
Price	10	8	10000	20000	Favorable

Question 3

The expenditure on food shows an unfavorable quantity variance of $48000.Similarly, the price variance on food expenditure shows unfavorable variance of $72000.

While analyzing such variance it can be seen that the quantity of the animals has increased, which is due to the successful breeding program. Thus, the increased number of animals require more food to live. Therefore, the increased animals have caused adverse effect on the budget with increased food expense.

The prices for the food were actually high. The zoo might have estimated wrong prices or the prices for food might increase over the time. There might be budgeting problems as well as budgets could be unrealistic.

Food expense
Expenditure Variance	Actual Quantity	Budgeted Quantity	Budgeted Price	Variance	Favorable/Unfavorable
Quantity	120	100	2400	48000	Unfavorable


Expenditure Variance	Actual Price	Budgeted Price	Actual quantity	Variance	Favorable/Unfavorable
Price	3000	2400	120	72000	Unfavorable