Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 36,600 customers, but actually served 27,400 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served:

• Revenue: $5.10q
• Wages and salaries: $34,800 + $1.58q
• Supplies: $0.98q
• Insurance: $12,000
• Miscellaneous expenses: $8000 + $0.46q

The company reported the following actual results for February: 

Revenue	$	151,800
Wages and salaries	$	69,600
Supplies	$	16,000
Insurance	$	12,000
Miscellaneous expense	$	25,700

Required: 

Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).

Fomat Example:

Arrasmith Corporation Flexible Budget Performance Report

Forthe Month Ended February 28

	Actual Results	Revenue and Spending Variances	Flexible Budget	Activity Variances	Planning Budget
Customers served	27,400		27,400		36,600
Revenue
Expenses:
Wages and salaries
Supplies
Insurance
Miscellaneous expense
Total expense
Net operating income

Please show process.