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 Lessons Revenue Actual Results 240 Planning Budget Variances $55,060 235 $54,050 $1,010 P Expenses: Instructor wages 11,865 11,750 115 U Aircraft depreciation 8,400 8,225 175 U Fool 4.840 4,230 610 U Maintenance 4,240 4,125 115 0 Ground facility expenses 2,010 2,075 65 P Administration 4,200 4,340 60 P Total expense 36,435 35,545 890 U Net operating income $18.625 $18,505 5120 P After several months of using these 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: Cost Formulas Fuel Revenue Instructor vages Aircraft depreciation Maintenance $230q $500 5354 $184 $600 + $15q Ground facility expenses 11,700 + 55, Administration $3,400 +$4q