Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

image text in transcribed
image text in transcribed
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: Planning Dudget 185 $ 44, 400 Variances $ 1.050 T Tiptop light school Variance Report For the Month Ended July 31 Actual Results Lessons 190 Revenue 545,450 Expenses Instructor wagen 12,180 Aircraft depreciation 7. 410 Puel 3,425 Maintenance 3.015 Ground facility expenses 2,925 Administration 4,295 Total expense 33,250 Net operating income $ 12,200 12,025 7,215 2,775 2,860 3,010 4,405 32 290 $ 12.110 155 195 U 650 U 155 U 85 110 T 960 U 590 $2409 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 is the number of lessons sold: Cost Formula Revenue Instructor wages $650 Aircraft depreciation Puol Maintenance $640 + $120 Ground facility expenses $1,900 + $69 Administration $3,480 + $59 Required: 2. Complete the flexible budget performance report for the school for July (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) $399 $154 TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Actual Flexible Results Budget 190 $ 45,450 Planning Budget 185 Lessons Revenue $ 44,400 Expenses: Instructor wages 12,180 12,025 Aircraft depreciation 7,410 7,215 Fuel Maintenance Ground facility expenses Administration Total expense Net operating income 3,425 3,015 2,925 4,295 33,250 $ 12,200 2,775 2,860 3,010 4,405 32,290 $ 12,110

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Statistical Analysis Microsoft Excel 2010

Authors: Conrad Carlberg

1st Edition

0789747200, 9780789747204

More Books

Students also viewed these Accounting questions