Question

Vulcan Flyovers offers scenic overflights of Mount St. Helens, the volcano in Washington State that explosively erupted in 1982. Data concerning the company's operations in July appear below: Vulcan Flyovers Operating Data For the Month Ended July 31 Flexible Planning Budget Actual Results Budget Flights (q) 56 56 54 Revenue ($340.00g) 16,100 19,040 18,360 Expenses: Wages and salaries ($3,300$91.00q) Fuel ($30.00q) Airport fees (S800 $34.00g) Aircraft depreciation ($8.00q) Office expenses ($210$1.00q) Total expense 8,354 1,850 2,589 8,396 1,680 2,704 8,214 1,620 2,636 432 448 448 434 264 266 13,166 13,675 13,494 2,425 5,546 5,194 Net operating income The company measures its activity in terms of flights. Customers can buy individual tickets for overflights or hire an entire plane for an overflight at a discount. Required: 1. Prepare a flexible budget performance report for July that includes revenue and spending variances and activity variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

Answer 1

Answer-

VULCAN FLYOVERS
FLEXIBLE BUDGET PERFORMANCE REPORT
FOR THE MONTH ENDED JULY 31
PARTICULARS	ACTUAL RESULTS	VARIANCES	REMARK	FLEXIBLE BUDGET	VARIANCES	REMARK	PLANNING BUDGET
	$	$		$	$		$
Flights	56			56			54
Revenue	16100	-2940	Unfavorable	19040	680	Favorable	18360
Expenses:-
Wages & Salaries	8354	42	Favorable	8396	-182	Unfavorable	8214
Fuel	1850	-170	Unfavorable	1680	-60	Unfavorable	1620
Airport fees	2589	115	Favorable	2704	-68	Unfavorable	2636
Aircraft depreciation	448	0	None	448	-16	Unfavorable	432
Office expenses	434	-168	Unfavorable	266	-2	Unfavorable	264
Total expenses	13675	-181	Unfavorable	13494	-328	Unfavorable	13166
Net operating income	2425	-3121	Unfavorable	5546	352	Favorable	5194