Exercise 9-1 Prepare a Flexible Budget (LO9-1) Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area. The company's planning budget for May appears below: Puget Sound Divers Planning Budget For the Month Ended May-31 Budgeted diving-hours (9) 1ee Revenue ($365.689) $ 36, See Expenses: Wages and salaries (58,eee + $125.089) 2e, see Supplies ($3.089) 300 Equipment rental (51,888 - 532.889) 5,eee Insurance (53,480) 3,400 Miscellaneous (5630 - $1.889) Total expense 3e eie Net operating income $ 6,490 810 During May, the company's actual activity was 105 diving-hours. Required: Prepare a flexible budget for May Puget Sound Divers Flexible Budget For the Month Ended May 31 Revenue Expenses Wages and salaries Supplies Equipment rental Insurance Miscellaneous Total expense Net operating income 0 $ 0 Exercise 9-2 Prepare a Report Showing Revenue and Spending Variances (LO9-2] 2 Quilcene Oysterta farms and sells oysters in the Pacific Northwest. The company harvested and sold 8.000 pounds of oysters in August. The company's flexible budget for August appears below: Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (9) 8,000 Revenue ($4.889) $ 32, eee Expenses: Packing supplies (58.589) 4, eee Oyster bed maintenance ($3,200) 3,298 Wages and salaries ($2,900 + $0.309) 5,300 Shipping ($e.se) 6,400 Utilities (5838) 830 other ($450 + $e.e59) 850 Total expense 20,580 Net operating income $ 11,420 ces The actual results for August appear below: Quilcene Oysteria Income Statement For the Month Ended August 31 Actual pounds 8,eee $ 35,280 Revenue Expenses: Packing Supplies Oyster bed maintenance Wages and salaries Shipping utilities other Total expense Net operating income 4,200 3,100 5,640 6,95 810 980 21,680 $ 13,520 Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as positive values.) Quilcene Oysteria Revenue and Spendina Variances Net operating income $ 11,420 2 The actual results for August appear below: 10 points Quilcene Oysteria Income statement For the Month Ended August 31 Actual pounds 8,000 $ 35, zee eBook Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities other Total expense Net operating income 4,200 3,100 5,640 6,95 81e 98e 21,650 $ 13,520 Hint References Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each varlance by selecting "F" for favorable. "U" Por unfavorable, and "None" for no effect (1.e., zero variance). Input all amounts as positive values.) Quilcene Oysteria Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income Exercise 9-3 Prepare a Flexible Budget with More Than One Cost Driver (LO9-3) 3 Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has Identified two cost drivers--the number of cruises and the number of passengers--that it uses in its budgeting and performance reports. The company publishes a schedule of day cruises that it may supplement with special salings if there is sufficient demand. Up to 80 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: 10 points Cost per Cruise $ 482.ee Cost per Passenger $ 2.00 Fixed cost per month $ 5,2ee $ 1,700 $ 4,3ee $ 2,900 Vessel operating costs Advertising Administrative costs Insurance eBook $ 24.00 $ 1.ee Hint References For example, vessel operating costs should be $5,200 per month plus $480 per cruise plus $2 per passenger. The company's sales should average $25 per passenger In July, the company provided 24 cruises for a total of 1,400 passengers. Required: Prepare the company's flexible budget for July Alyeski Tours Flexible Budget For the Month Ended July 31 Revenue Expenses Vessel operating costs Advertising Administrative costs Insurance Total expense Net operating income