Tip Top Flight School offers flying lessons at a small municipal airport The school's owner and manager has been attempting to evaluate performance and control costs using a variance report that compares the planning budget to actual results. A recent variance report appears below After several months of using such variance reports, the owner has become frustrated. For example, she is quite confident that instructor wages were very tightly controlled in July, but the deport shows an unfavorable variance The planning budget was developed using the following formulas, where qis the number of lessons sold TipTop Flight School Variance Report For the Month Ended July 31 Actual Planning Results Budget Cost Formulas Variances 155 $33,900 150 $33,000 $900 F Revenue.... Instructor wages Aircraft depreciation. Fuel. Maintenance ...... Ground facility expenses. Administration......... $2200 $659 $389 $150 $ 530 + $129 $1.250 + $29 $3.240 + $10 Lessons Revenue Expenses: Instructor wages. Aircraft depreciation Fuel... . Maintenance.. Ground facility expenses Administration. Total expense... Net operating Income.. 9,870 5.890 2.750 2,450 1,540 3.320 25,820 $ 8, 00 9,750 5.700 2.250 2,330 1.550 3,390 24.970 $ 8,030 120 U 190 U 500U 120 U 10 F 70 F 850 U $ 50 F Required: 1. Should the owner feel frustrated with the variance reports? Explain 2. Prepare a flexible budget performance report for the school for July 3. Evaluate the school's performance for July