Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company
ID: 2511284 • Letter: Q
Question
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,000 pounds of oysters in August. The company’s flexible budget for August appears below:
The actual results for August appear below:
Required:
Calculate the company’s revenue and spending variances for August. (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.)
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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:
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.)
Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (q) 7,000 Revenue ($4.25q) $ 29,750 Expenses: Packing supplies ($0.25q) 1,750 Oyster bed maintenance ($3,500) 3,500 Wages and salaries ($2,200 + $0.30q) 4,300 Shipping ($0.60q) 4,200 Utilities ($1,260) 1,260 Other ($410 + $0.01q) 480 Total expense 15,490 Net operating income $ 14,260Explanation / Answer
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1 Revenue and Spending Variance Flexible Budget Actual Revenue/spending variance Favorable/Unfavorable Actual Pounds 7000 7000 Revenue 29750 26800 2950 Unfavorable Expenses: Packaging Supplies 1750 1920 170 Unfavorable Bed Maintenance 3500 3360 140 Favorable Wages and salaries 4300 4710 410 Unfavorable Shipping 4200 3930 270 Favorable Utilities 1260 1070 190 Favorable Other 480 1100 620 Unfavorable Total Expense 15490 16090 600 Unfavorable Net Operating income 14260 10710 2350 Unfavorable 2 Activity and Revenue-Spending Variance Actual vs Flexible Flexible vs Planning Revenue and Spending Variance Activity Variance Acutal Flexible Planning $ U/F $ U/F Flights (q) 59 59 57 0 None 2 F Revenue ($360.00q) 16,400 21,240 20,520 4,840 U 720 F Expenses: Wages and salaries ($3,600 + $86.00q) 8,642 8,674 8,502 32 F 172 U Fuel ($32.00q) 2,054 1,888 1,824 166 U 64 U Airport fees ($880 + $33.00q) 2,722 2,827 2,761 105 F 66 U Aircraft depreciation ($8.00q) 472 472 456 0 None 16 U Office expenses ($220 + $1.00q) 447 279 277 168 U 2 U Total expense 14,337 14,140 13,820 197 U 320 U Net operating income 2,063 7,100 6,700 5,037 U 400 FRelated Questions
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