Question

9-4

Exercise 9-4 Prepare a Flexible Budget Performance Report (L09-4) 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 D Vulcan Flyovers Operating Data For the Month Ended July 31 Actual Results Flexible Planning Budget Flights (9) 10 $ 16,200 18.755 18,285 8,151 8.185 1.82 2.59e 3,011 1. 2 2,526 2.45 Revenue ($345.00) Expenses Wapes and salaries ($3,400.587.00) Fuel ($14.00) Airport fees (13.532. ) Aircraft depreciation (511.000) Office expenses (5220 51.00) Total expense Net operating income 13,52511195 5,450 $ 5.00 $ 2,519 $ The company measures its activity in terms of fights 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 (.e., zero variance). Input all amounts os positive values.) Vulcan Flyovers Flexible Budget Performance Report For the Month Ended July 31 Flexible Budget Ach Results Flights 55 S 10.200 T S 18. 075 318255 Revenue Expenses Wages and sales 151 1.8701 2.500 Airport fees Aircraft depreciation Office expenses Total expense Net operating income 2.450 005 40 13.681 2,510 3 13.525 5.450

Answer 1

Vulcan Flyovers
Flexible Budget Report
For the month ended July 31
	Actual results	Revenue and Spending Variances		Flexible Budget	Activity Variance		Planning Budget
Flights	55			55			53
Revenue	$ 16,200	$    2,775	U	$ 18,975	$        690	F	$ 18,285
Expenses:
Wages and salaries	$    8,151	$          34	F	$    8,185	$        174	U	$    8,011
Fuel	$    2,032	$        162	U	$    1,870	$          68	U	$    1,802
Airport fees	$    2,450	$        140	F	$    2,590	$          64	U	$    2,526
Aircraft depreciation	$        605	$           -	None	$        605	$          22	U	$        583
Office expenses	$        443	$        168	U	$        275	$             2	U	$        273
Total expense	$ 13,681	$        156	U	$ 13,525	$        330	U	$ 13,195
Net operating income	$    2,519	$    2,931	U	$    5,450	$        360	F	$    5,090

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