Part 2. Problems. There are five problems and one bonus problem. Each one is worth. the score indicated next to the problem number. Show all work for complete credit. You may attach extra pages if you so desire. Please be NEAT when writing your answers. I cannot grade illegible answers. (40 points possible) 1. (8 points) Pie Guys Pizzeria is owned and operated by three brothers. Data concerning the pizzeria's monthly revenues and costs appear below (q refers to the number of pizzas served): Formula Revenue $15.05q Cost of ingredients $4.90q Rent $2,050 Utilities $300 + $0.20q Salaries: $6,000 Miscellaneous $500+ $0.60q Actual results for February appear below. Prepare a flexible budget performance report for the pizzeria for February for 1,300 pizzas. Revenue Cost of ingredients Rent Utilities i Salaries Miscellaneous Required: $19,400 6,500 2,050 540 6,150 1,150 a. Prepare a budget for 1,200 pizzas (this is the planning budget). b. Prepare a budget for 1,300 pizzas (this is the flexible budget). c. Compute the activity variances between the two budgets and revenue/spending variances between the actual data and the flexible budget. Also indicate whether the variance is favorable or unfavorable. Planning Actual Units Actual Results (1,300 pizzas) Revenue & Spending Variances Flexible Budget (1,300 pizzas) Activity Variances Budget (1,200 pizzas) Revenue Expenses: Cost of ingredients Rent Utilities Salaries Miscellaneous Total expenses Net operating income Focus