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 Results Flexible Budget Planning Budget Flights (q) 52 52 50 Revenue ($345.00q) $ 16,000 $ 17,940 $ 17,250 Expenses: Wages and salaries ($3,700 + $87.00q) 8,190 8,224 8,050 Fuel ($34.00q) 1,930 1,768 1,700 Airport fees ($880 + $35.00q) 2,560 2,700 2,630 Aircraft depreciation ($9.00q) 468 468 450 Office expenses ($220 + $1.00q) 440 272 270 Total expense 13,588 13,432 13,100 Net operating income $ 2,412 $ 4,508 $ 4,150 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

answered by: anonymous