Exercise 9-4 (Algo) 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: Vulcan Flyovers Operating Data For the Month Ended July 31 Actual Results 55 Flexible Planning Budget Budget 55 53 Flights (9) $ 16,200 $ 19,250 $ 18,550 Revenue ($350.009) Expenses: Wages and salaries ($3,600 + $91.009) Fuel ($33.009) Airport fees ($880 + $35.009) Aircraft depreciation ($10.009) Office expenses ($210 + $1.009) Total expense Net operating income 8,563 8,605 1,979 1,815 2,660 2,805 550 550 433 265 14,185 14,040 $ 2,015 $ 5,210 $ 8,423 1,749 2,735 530 263 13,700 4,850 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 Revenue and Spending Flexible Variances Budget Actual Results Activity Variances Planning Budget 53 Flights 55 55 Revenue $ 16.200 U $ 19.250 F $ 18.550 Expenses Wages and salaries Fuel 8,563 F 8,605 U 8.423 1.815 1,749 1,979 2,660 2,805 U 2,735 F None 550 550 530 Airport fees Aircraft depreciation Office expenses Total expense Net operating income 265 433 14,185 U U U 263 13,700 14.040 $ 2,015 $ 5,210 F $ 4,850 Exercise 9-16 (Algo) Flexible Budget Performance Report [LO9-1, LO9-2, LO9-3, LO9-4) Air Qual Test Corporation provides on-site air quality testing services. The company has provided the following cost formulas and actual results for the month of February Fixed Component per Month Revenue Technician wages Mobile lab operating expenses office expenses Advertising expenses Insurance Miscellaneous expenses $ 8,100 $ 5,000 $ 2,300 $ 1,580 $ 2,900 $ 970 Variable Actual Total Component per Job for February $ 279 $ 30,730 $ 7,950 $ 31 $ 8,560 $ 4 $ 2,630 $ 1,650 $ 2,900 $ 1 $ 395 The company uses the number of jobs as its measure of activity. For example, mobile lab operating expenses should be $5,000 plus $31 per job, and the actual mobile lab operating expenses for February were $8,560. The company expected to work 120 jobs in February, but actually worked 128 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 (.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 Planning Budget Jobs 128 $ 30,730 7,950 8,560 Revenue Expenses: Technician wages Mobile lab operating expenses Office expenses Advertising expenses Insurance Miscellaneous expenses Total expense Net operating income 2,630 1,650 2.900 395 24,085 $ 6,645
