Mt. Hood Air offers scenic over flights of Mt. Hood and the Columbia River gorge. Data concerning the companys operations in August appear below: Mt. Hood Air Operating Data For the Month Ended August 31

	planning budget	flexible budget	actual results
flights q	50		52
revenue (360.00q)	$18000		$16980
expenses
wages & salaries ( 3,800 +92.00q)	$8400		$8540
Fuel ($34.00q)	$1700		$1930
Airport fees ($870 + $ 35.00q)	$2620		$2690
aircraft depreciation ($11.00q)	$550		$572
Office expenses ( $ 230+ 1.00q)	$280		$450
Total Expenses	$13550		$14182
Net operating income	$4450		$2798

The company measures its activity in terms of flights. Customers can buy individual tickets for over flights or hire an entire plane for an over flight at a discount. 1.

1- Prepare a flexible budget performance report for August.

2- Which of the variances should be of concern to management? Explain