TipTop 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: TipTop Flight School Variance Report For the Month Ended July 31 Actual Planning Results Budget Variances 175 170 Lessons Revenue $35,790 $34,850 $940 F Expenses Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration 11,050 10,880 170 U 6,630 195 U 3,700 3,230 470 U 2,470 2,360 110 U 95 F 4,360 55 F 6,825 1,980 1,885 4,305 Total expense 30,235 29,440 795 U Net operating income $ 5,555 $ 5,410 $145 F 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 report shows an unfavorable variance The planning budget was developed using the following formulas, where q is the number of lessons sold Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility Cost Formulas $205q $64q $39q $19q $660 $10q $1,640 $2q $4,190+$1q expenses Administration