chap 9 alg 2

Vulcan Flyovers Operating Data For the Month Ended July 31 Actual Results 53 Flexible Planning Budget Budget 53 51 Flights (9) $ 16,500 $ 18,815 $ 18,105 Revenue ($355.009) Expenses: Wages and salaries ($3,000 + $87.009) Fuel ($33.009) Airport fees ($830 + $30.009) Aircraft depreciation ($10.009) Office expenses ($220 + $1.009) Total expense Net operating income 7,577 7,611 1,913 1,749 2,285 2,420 530 530 441 273 12,746 12,583 3,754 $ 6,232 $ 7,437 1,683 2,360 510 271 12,261 5,844 $ 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. 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 Flexible Budget Performance Report For the Month Ended July 31 Flexible Budget Actual Results Planning Budget 51 Flights 53 53 $ 16,500 | $ 18,815 | $ 18,105 Revenue Expenses Wages and salaries Fuel Airport fees Aircraft depreciation Office expenses Total expense Net operating income 7,577 1,913 2,285 530 441 12,746 3,754 7,611 1,749 2,420 530 273 12,583 6,232 7,437 1,683 2,360 510 271 12,261 5,844 $ $ $ Fixed Cost per Month $ 20,800 Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses Cost per Repair-Hour $ 15.00 $ 7.70 $ 0.35 $ 1.70 $ $ $ $ 2,730 5,730 4,630 3,890 $ 0.50 For example, wages and salaries should be $20,800 plus $15.00 per repair-hour. The company expected to work 3,000 repair-hours in May, but actually worked 2,900 repair-hours. The company expects its sales to be $53.00 per repair-hour. Required: Compute the company's activity variances for May. (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.) Jake's Roof Repair Activity Variances For the Month Ended May 31 Revenue Expenses: Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses Total expense Net operating income Fixed Component per Month Revenue Technician wages Mobile lab operating expenses Office expenses Advertising expenses Insurance Miscellaneous expenses $ 8,100 $ 4,500 $ 2,200 $ 1,580 $ 2,880 $ 970 Variable Actual Total Component per Job for February $ 275 $ 35,750 $ 7,950 $ 30 $ 8,540 $ 2 $ 2,330 $ 1,650 $ 2,880 $ 1 $ 415 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $4.500 plus $30 per job, and the actual mobile lab operating expenses for February were $8,540. The company expected to work 140 jobs in February, but actually worked 148 jobs. Required: Prepare a flexible budget performance report showing Air Qual Test Corporation's revenue and spending variances and activity variances for February (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.) AirQual Test Corporation Flexible Budget Performance Report For the Month Ended February 28 Actual Flexible Results Budget 148 Planning Budget Jobs Revenue $ 35,750 Expenses: Technician wages Mobile lab operating expenses Office expenses Advertising expenses Insurance 7,950 8,540 2,330 1.650 2,880 415 23,765 11,985 Miscellaneous expenses Total expense Net operating income $