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Flight Caf prepares in-flight meals for airlines and its planning budget for July appears below: Flight Caf Planning Budget For the Month Ended July 31
Flight Caf prepares in-flight meals for airlines and its planning budget for July appears below:
Flight Caf | |
---|---|
Planning Budget | |
For the Month Ended July 31 | |
Budgeted meals (q) | 25,000 |
Revenue ($4.20q) | $ 105,000 |
Expenses: | |
Raw materials ($2.10q) | 52,500 |
Wages and salaries ($6,100 + $0.20q) | 11,100 |
Utilities ($2,000 + $0.05q) | 3,250 |
Facility rent ($3,400) | 3,400 |
Insurance ($2,300) | 2,300 |
Miscellaneous ($700 + $0.10q) | 3,200 |
Total expenses | 75,750 |
Net operating income | $ 29,250 |
In July, 26,000 meals were actually served. The companys flexible budget for this level of activity appears below:
Flight Caf | |
---|---|
Flexible Budget | |
For the Month Ended July 31 | |
Budgeted meals (q) | 26,000 |
Revenue ($4.20q) | $ 109,200 |
Expenses: | |
Raw materials ($2.10q) | 54,600 |
Wages and salaries ($6,100+ $0.20q) | 11,300 |
Utilities ($2,000 + $0.05q) | 3,300 |
Facility rent ($3,400) | 3,400 |
Insurance ($2,300) | 2,300 |
Miscellaneous ($700 + $0.10q) | 3,300 |
Total expenses | 78,200 |
Net operating income | $ 31,000 |
Required:
1. Calculate the companys activity variances for July.
Note: 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.
\begin{tabular}{|l|l|} \hline \multicolumn{2}{c}{ Flight Caf } \\ \hline For the Month Ended July 31 \\ \hline Revenue & \\ \hline Expenses: & \\ \hline Waw materials & \\ \hline Utilities & \\ \hline Facility rent & \\ \hline Insurance & \\ \hline Miscellaneous & \\ \hline Total expenses & \\ \hline Net operating income & \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline \multicolumn{2}{c}{ Flight Caf } \\ \hline For the Month Ended July 31 \\ \hline Revenue & \\ \hline Expenses: & \\ \hline Waw materials & \\ \hline Utilities & \\ \hline Facility rent & \\ \hline Insurance & \\ \hline Miscellaneous & \\ \hline Total expenses & \\ \hline Net operating income & \\ \hline \end{tabular}Step by Step Solution
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