Exercise 9-4 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 Flexible Planning Results Budget Budget 55 55 53 Flights (9) $ 16,300 $ 18,975 $ 18,285 Revenue ($345.00q) Expenses: Wages and salaries ($3,100 + $91.00) Fuel ($34.00) Airport fees ($810 + $33.00) Aircraft depreciation ($8.009) Office expenses ($250 + $1.00) Total expense Net operating income 8,063 8,105 7,923 2,032 1,870 1,802 2,490 2,625 2,559 440 440 424 473 305 303 13,498 13, 345 13,011 $ 2,802 $ 5,630 $ 5,274 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 53 Flights 55 55 Revenue $ 16,300 $ 18,975 $ 18,285 8,063 Expenses: Wages and salaries Fuel Airport fees 8,105 1,870 2,625 7,923 1,802 2,032 2,490 2,559 440 440 424 Aircraft depreciation Office expenses Total expense 473 305 303 13,011 13,498 2,802 13,345 5,630 Net operating income $ $ $ 5,274 Problem 9-26 Critiquing a Cost Report; Preparing a Performance Report (LO9-1, LO9-2, LO9-3, LO9-4, LO9-6) Frank Weston, supervisor of the Freemont Corporation's Machining Department, was visibly upset after being reprimanded for his department's poor performance over the prior month. The department's cost control report is given below: Freemont Corporation-Machining Department Cost Control Report For the Month Ended June 30 Actual Planning Results Budget Variances Machine-hours 42,000 40,000 Direct labor wages Supplies Maintenance Utilities Supervision Depreciation Total $ 79,200 24,300 23,700 21,400 47,000 79,000 $ 274,600 $ 77,200 22,400 21,300 19,900 47,000 79,000 $266,800 $2,000 U 1,900 U 2,400 U 1,500 U $7,800 U "I just can't understand all of these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, I thought he was going to give me a pat on the back because I know for a fact that my department worked more efficiently last month than it has ever worked before. Instead, he tore me apart. I thought for a minute that it might be over the supplies that were stolen out of our warehouse last month. But they only amounted to a couple of hundred dollars, and just look at this report. Everything is unfavorable." Direct labor wages and supplies are variable costs; supervision and depreciation are fixed costs; and maintenance and utilities are mixed costs. The fixed component of the budgeted maintenance cost is $14,500; the fixed component of the budgeted utilities cost is $13,400. Required: 2. Complete the performance report that will help Mr. Weston's superiors assess how well costs were controlled in the machining department. (Round your intermediate calculations to 2 decimal places. 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.) Freemont CorporationMachining Department Flexible Budget Performance Report For the Month Ended June 30 Actual Flexible Results Budget 42,000 Planning Budget 40,000 Machine-hours Direct labor wages Supplies Maintenance Utilities Supervision Depreciation Total $ 79,200 24,300 23,700 21,400 47,000 79,000 $ 274,600 $ 77,200 22,400 21,300 19,900 47,000 79,000 $ 266,800