Vulcan Flyovers offers scenic overflights of Mount St. Helens, the volcano in Wa

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 ResultsBudget Budget 56 Flights (4) 58 58 16,18 28,308 $19,688 Revenue ($350.084) Expenses Wages and salaries ($3,380$89.88q) Fuel ($33.884) Airport fees ($890$31.88q) Aircraft depreciation ($9.88q) Office expenses ($228$1.80q) 8,424 2,878 2,563 8,462 1,914 2,688 8,284 1,848 2,626 276 13,538 2,867 $6,436 6,862 278 13,864 446 Total expense 14,833 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. Requlrec 1. Prepare a flexible budget performance report for July that includes revenue and spending variances and activity variances. (Indlcate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero varlance). Input all amounts as postlve values.) Flexible Budget Performance Report For the Month Ended July 31 Flexible Actual Results Flights 58 58 56 16,100 20,300 19,600 Wages and salaries Fuel Airport fees Aircraft depreciation Office expenses 8,424 2,078 2,563 8,482 1,914 2,688 8,284 1,848 2,626 Total expense 14,033 13,864 13,538 Net operating income 2,067 6.436 6,062

Explanation / Answer

Vulcan Flyovers Flexible Budget Performance Report For the Month Ended July 31 Actual results Revenue& Spending Variance Flexible Budget Activity variance Planning Budget Flights 58 58 56 Revenue 16100 -4200 20300 -700 19600 Expenses: Wages & salaries 8424 -38 8462 -178 8284 Fuel 2078 164 1914 -66 1848 Airport fees 2563 -125 2688 -62 2626 Aircraft depn. 522 0 522 -18 504 Office expenses 446 168 278 -2 276 Total expenses 14033 169 13864 -326 13538 Net Operating Income 2067 -4369 6436 -374 6062 -ve signs are F variances & others are U variances

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