) Pie Guys Pizzeria is owned and operated by three brothers. Data concerning the pizzerias monthly revenues and costs appear below (q refers to the number of pizzas served):

	Formula
Revenue	$14.75q
Cost of ingredients	$4.35q
Rent	$2,150
Utilities	$350 + $0.25q
Salaries	$7,200
Miscellaneous	$900 + $.45q

Actual results for February appear below. Prepare a flexible budget performance report for the pizzeria for February for 2,200 pizzas.

Revenue	$32,000
Cost of ingredients	9,900
Rent	2,150
Utilities	918
Salaries	7,300
Miscellaneous	1,850

Required:

Prepare a budget for 2,300 pizzas (this is the static budget).

Prepare a budget for 2,200 pizzas (this is the flexible budget).

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.