Question 3 - The owner of Rick's Hairstyling, prepared the March budget and also the March actual that appears below. Net Income is higher than budget, however, based on the additional 100 visits (1,100 actual vs 1,000) net income is expected to be higher. Prepare a flexible budget at the 1,100 visit level and compare revenue, expenses and operating income actual to the flexible budget. Rick's Hairstyling Planning Budget For the Month Ended March 31 Budgeted client-visits (quantity - 4) 1,000 Revenue ($180.00) $180,000 Expenses: Wages and salaries ($65,000 +$37.00) 102,000 Hairstyling supplies ($1.509) 1,500 Client gratuities ($4.100) 4,100 Electricity ($1,500 + $0.109) 1,600 Rent ($28,500) 28,500 Liability insurance ($2,800) 2,800 Employee health insurance ($21,300) 21,300 Miscellaneous ($1,200 + $0.209) 1.400 Total expense 163 200 Net operating income $ 16,800 I Notice, Rick created formulas for his revenue and his expenses. The hairstyling supplies and client gratuities are variable costs. The wages and salaries, electricity, and miscellaneous are mixed costs.(variable portion shown $/q) The rent, liability insurance, and employee health insurance are fixed costs. Rick's Hairstyling Actual Income Statement For the Month Ended March 31 Actual client-visits 1,100 $194 200 Revenue Expenses: Wages and salaries Hairstyling supplies Client gratuities Electricity Rent Liability insurance Employee health insurance Miscellaneous Total expense Net operating income 106,900 1.620 6,870 1,550 28,500 2,800 22,600 2,130 172,970 $ 21,230