1.

Vulcan Flyovers Flexible Budget Performance Report For the Month Ended July 31
	Actual Results	Revenue and Spending Variances		Flexible Budget	Activity Variances		Planning Budget
Flights (q)........................................	48			48			50
Revenue .........................................
Expenses:
Wages and salaries ......................
Fuel..............................................
Airport fees ..................................
Aircraft depreciation (...................
Office expenses ...........................
Total expense..................................
Net operating income......................	$ 814	$2,410	U	$ 3,224	$336	U	$ 3,560

2.

EXERCISE 9-4 Prepare a Flexible Budget Performance Report LO9-4 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: Flexible Budget Planning Budget 48 48 ......... Vulcan Flyovers Operating Data For the Month Ended July 31 Actual Results Flights (9) ................... Revenue ($320.00q) $13,650 Expenses: Wages and salaries ($4,000 + $82.00q) ..... 8,430 Fuel ($23.00q) ... 1,260 Airport fees ($650 + $38.009) 2,350 Aircraft depreciation ($7.00q) 336 Office expenses ($190 + $2.00q). 460 Total expense 12,836 Net operating income. $ 814 50 $16,000 $15,360 7,936 1,104 2,474 336 286 12,136 $ 3,224 8,100 1,150 2,550 350 290 12,440 $ 3,560 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. Using Exhibit 9-8 as your guide, prepare a flexible budget performance report for July that includes revenue and spending variances and activity variances. 2. Which of the variances should be of concern to management? Explain