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 Results 155 Planning Budget 150 Variances Lessons $ 33,900 $ 33,000 $ 900 F 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 9,750 5,700 2,250 2,330 1,550 3,390 24,970 $ 8,030 1,540 120 190 500 120 10 70 850 $ 50 U U U U F F U 3,320 25,820 $ 8,080 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 is the number of lessons sold: Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Cost Formulas $2209 $659 $389 $150 $530 + $129 $1,250 + $29 $3,240 + $19 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.) Answer is not complete. Tip Top Flight School Flexible Budget Performance Report For the Month Ended July 31 Revenue and Actual Flexible Results Spending Variances Budget 155 155 Activity Variances Planning Budget Lessons 150 Revenue $33,900 $ 2,350 X U $ 34,100 F 1,100 $ 33,000 Expenses: Instructor wages Aircraft depreciation 9,870 F 325 U 9,750 5,890 10,075 5,890 2,325 5,700 190U 75U Fuel 2,750 2,250 2,450 60U 2,330 Maintenance Ground facility expenses Administration 2,990 X None 445 X U U 760 U 1,300 X F 2,850 24,835 U $ 14,765 U 2,390 1,560 OOOOOOOO 1,540 10U 1,550 CCT TCC 3,320 3,395 5 U 3,390 24,970 Total expense 25,635 665 U 25,820 $ 8,080 Net operating income $ 8,465 $ 435 F $ 8,030