Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Coastal Seaplane Tours provides unique aerial tours of the scenic coastline and famous landmarks in the region. The company specializes in offering customers memorable experiences

Coastal Seaplane Tours provides unique aerial tours of the scenic coastline and famous landmarks in the region. The company specializes in offering customers memorable experiences by flying over breathtaking landscapes. The data provided below pertains to the company's operations for the month of July, capturing both the actual outcomes and the budgeted figures for comparison and analysis.
Operating Data
For the Month Ended July 31
Actual Results
Flexible
Budget
Planning
Budget
Flights (q)....................
48
48
50
Revenue ($320.00q)...............
$13,650
$15,360
$16,000
Expenses:
Wages and salaries ($4,000+ $82.00q)......
8,430
7,936
8,100
Fuel ($23.00q).................
1,260
1,104
1,150
Airport fees ($650+ $38.00q)..........
2,350
2,474
2,550
Aircraft depreciation ($7.00q)..........
336
336
350
Office expenses ($190+ $2.00q).........
460
286
290
Total expense..................
12,836
12,136
12,440
Net operating income...............
$814
$3,224
$3,560
Required Analysis:
1. Flexible Budget Performance Report for July:
Develop a flexible budget performance report for Coastal Seaplane Tours for the month of July. This report should delineate the variances between the actual results and the flexible budget figures, including detailed analyses of revenue, spending, and activity variances.
2. Identifying and Explaining Significant Variances:
Examine which variances should raise concerns for management. Provide a detailed analysis of significant discrepancies between the actual results and the budgeted figures, particularly focusing on larger or unexpected variances. Discuss potential reasons behind these variances and suggest what specific areas management should investigate further to understand the underlying causes.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting And Causal Effects Econometric Challenges

Authors: Douglas A Schroeder

1st Edition

1441972242, 9781441972248

More Books

Students also viewed these Accounting questions

Question

=+Explain the key responsibilities of each social media role

Answered: 1 week ago