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.)

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 57 Flexible Planning Budget Budget 57 55 Flights (9) $ 16,400 $ 20,235 $ 19,525 Revenue ($355.009) Expenses: Wages and salaries ($3,600 + $89.009) Fuel ($33.009) Airport fees ($890 + $35.009) Aircraft depreciation ($10.009) Office expenses ($210 + $1.009) Total expense Net operating income 8,635 8,673 8,495 2,045 1,881 1,815 2,740 2,885 2,815 570 570 550 435 267 265 14,425 14,276 13,940 $ 1,975 $ 5,959 $ 5,585 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. Flexible Budget Performance Report For the Month Ended July 31 Flexible Budget 57 Actual Results Planning Budget 55 Flights 57 Revenue $ 16,400 $ 20,235 $ 19,525 Expenses: 8,673 8,495 Wages and salaries Fuel 8,635 2,045 1,815 Airport fees 2,740 1,881 2,885 570 2,815 Aircraft depreciation 570 550 Office expenses 435 267 265 Total expense 14,425 14,276 13,940 Net operating income $ 1,975 $ 5,959 $ 5,585