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 Actual Flexible planning Results Budget Budget nok Flights (9) $ 16,300 $ 20.700 $20,010 ences 8.640 1,920 2.880 Revenue ($345.004) Expenses: Wages and salaries ($3,300 + $89.00) Fuel ($32.009) Airport fees ($840 + $34.009) Aircraft depreciation (59.009) office expenses ($240 + $1.009) Total expense Net operating income B, 602 2.086 2,765 540 468 14,461 1,839 540 8, 462 1,856 2.812 522 298 13,950 6,060 300 14,280 $ 6,420 $ 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 (.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	60			60			58
Revenue	16300	-4400	Unfavorable	20700	690	Favorable	20010
Expenses:-
Wages & Salaries	8602	38	Favorable	8640	-178	Unfavorable	8462
Fuel	2086	-166	Unfavorable	1920	-64	Unfavorable	1856
Airport fees	2765	115	Favorable	2880	-68	Unfavorable	2812
Aircraft depreciation	540	0	None	540	-18	Unfavorable	522
Office expenses	468	-168	Unfavorable	300	-2	Unfavorable	298
Total expenses	14461	-181	Unfavorable	14280	-330	Unfavorable	13950
Net operating income	1839	-4581	Unfavorable	6420	360	Favorable	6060