Flight Caré prepares in-flight meals for alrines in its kitchen located next to
ID: 2579850 • Letter: F
Question
Flight Caré prepares in-flight meals for alrines in its kitchen located next to a local alrport. The company's planning budget for July appears below: Flight Café Planning Budget For the Month Ended July 31 Budgeted meals (q) 28,000 Revenue (53.909 Expenses: $109.200 Raw materials ($2 30q) Wages and salaries (S6,400$0 20q) Utilities ($2,100 50.05q) Facility rent ($3,800) Insurance ($2,400) Miscellaneous (3900 30.10q) 64400 12,000 3.500 3.800 2.400 3.700 Total expense Net operating income 3 19.400 in July, 29,000 actually meals were served. The company's tiexible budget for this level of actvity appears below Flight Café Flexible Budget For the Month Ended July 31 Budgeted meals () 29,000 Revenue (53.90g) Expenses: 5113,100 Raw materials ($2 30q) Wages and salaries (S6,400+50.20g) Utilities ($2,100 50.05q) Facility rent ($3,800) Insurance ($2,400) Miscellaneous (3900 30.10q) 66,700 12,200 3,550 3,800 2.400 3,800 92,450 5 20,650 Total expense Net operating income Required: 1. Calculate the company's activity varnances for July. (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.) Flight Café Activity Variances For the Month Ended July 31 Revenue Expenses Raw materials Wages and salaries Utilities Facility rent Insurance Miscellaneous Total expense Net operating incomeExplanation / Answer
Planning budget Activity variances Flexible budget Revenue 109200 3900 F 113100 Expenses: Raw materials 64400 2300 U 66700 Wages and salaries 12000 200 U 12200 Utilities 3500 50 U 3550 Facility rent 3800 0 None 3800 Insurance 2400 0 None 2400 Miscellaneous 3700 100 U 3800 Total expense 89800 2650 U 92450 Net operating income 19400 1250 F 20650
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