Flight Café is a company that prepares in-flight meals for airlines in its kitch

Question

Flight Café is a company that prepares in-flight meals for airlines in its kitchen located next to the local airport. The company's planning budget for July appears below Flight Cafeé Planning Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.50q) Expenses 29,000 $130,500 Raw materials ($1.90q) Wages and salaries ($6,1000.20q) Utilities ($2,000 +$O.05q) Facility rent ($3,900) Insurance ($2,100) Miscellaneous ($900+ $0.10q) 55,100 11,900 3,450 3,900 2,100 3,800 Total expense Net operating income 50,250 In July, 30,000 meals were actually served. The company's flexible budget for this level of activity appears below Flight Café Flexible Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.50q) 30,000 $135,000 Raw materials ($1.90q) Wages and salaries ($6,100$0.20q) Utilities ($2,000$0.05q) Facility rent ($3,900) Insurance ($2,100) Miscellaneous ($900 +$0.10q) 57,000 12,100 3,500 3,900 2,100 3,900 82,500 52,500 Total expense Net operating income

Explanation / Answer

Activity variances Revenue 4500 F Expenses: Raw materials 1900 U Wages and salaries 200 U Utilities 50 U Facility rent 0 None insurance 0 None Miscellaneous 100 U Total expense 2250 U Net operating income 2250 F

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