Question

Exercise 9-4 Prepare a Flexible Budget Performance Report [LO9-4] 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 Actual Flexible Results Budget 5757 $ 16,400 $20,520 Planning Budget 55 Flights (9) Revenue ($360.000) $19,800 Expenses: Wages and salaries ($3,700 + $90.000) Fuel ($34.009) Airport fees ($840 + $30.000) Aircraft depreciation ($10.00) Office expenses ($200 + $1.00) 8,790 2,100 2,430 570 425 8,830 1,938 2,550 570 257 8,650 1,870 2,490 550 255 Total expense 14,315 14.145 13,815 Net operating income $ 2,085 $ 6,375 $ 5,985 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. Complete the flexible budget performance report abstract for July (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.) Vulcan Flyovers Flexible Budget Performance Report For the Month Ended July 31 Revenue and Spending Variances Activity Variances Revenue ſ Expenses: Wages and salaries Fuel Airport fees i Aircraft depreciation Office expenses Total expense Net operating income

Answer 1

	Actual results	Revenue and spending variances		Flexible budget	Activity variances		Planning budget
Revenue	16400	4120	U	20520	720	F	19800
Expenses:
Wages and salaries	8790	40	F	8830	180	U	8650
Fuel	2100	162	U	1938	68	U	1870
Airpost fees	2430	120	F	2550	60	U	2490
Aircraft depreciation	570	0	None	570	20	U	550
Office expenses	425	168	U	257	2	U	255
Total expense	14315	170	U	14145	330	U	13815
Net operating income	2085	4290	U	6375	390	F	5985