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Flight Caf prepares in-flight meals for airlines in its kitchen located next to a local airport. The companys planning budget for July appears below: Flight
Flight Caf prepares in-flight meals for airlines in its kitchen located next to a local airport. The companys planning budget for July appears below:
Flight Caf | |
Planning Budget | |
For the Month Ended July 31 | |
Budgeted meals (q) | 21,000 |
---|---|
Revenue ($3.90q) | $ 81,900 |
Expenses: | |
Raw materials ($2.30q) | 48,300 |
Wages and salaries ($6,200 + $0.20q) | 10,400 |
Utilities ($1,900 + $0.05q) | 2,950 |
Facility rent ($3,500) | 3,500 |
Insurance ($2,700) | 2,700 |
Miscellaneous ($500 + $0.10q) | 2,600 |
Total expense | 70,450 |
Net operating income | $ 11,450 |
In July, 22,000 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) | 22,000 |
---|---|
Revenue ($3.90q) | $ 85,800 |
Expenses: | |
Raw materials ($2.30q) | 50,600 |
Wages and salaries ($6,200+ $0.20q) | 10,600 |
Utilities ($1,900 + $0.05q) | 3,000 |
Facility rent ($3,500) | 3,500 |
Insurance ($2,700) | 2,700 |
Miscellaneous ($500 + $0.10q) | 2,700 |
Total expense | 73,100 |
Net operating income | $ 12,700 |
. REQUIRED
Calculate the companys activity variances for July.
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