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TipTop Flight School offers flying lessons at a small municipal airport. The schools owner and manager has been attempting to evaluate performance and control costs

TipTop Flight School offers flying lessons at a small municipal airport. The schools 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: image text in transcribedimage text in transcribed

Problem 9-22 Critique a Report; Prepare a Performance Report [LO9-1, LO9-2, LO9-3, LO9-4, 09-6] 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 Lessons 155 150 Revenue $ 36,970 S 36.000 $ 970 F Expenses: Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration 9,750 170 U 4,650 155 U 2,700 570 U 2,360 170 U 45 F 3,920 105 F 26,545 25,630 915 U 10,425 $10,370 $ 55 F 9,920 4,805 3,270 2,530 2,205 3,815 2,250 Total expense Net operating income 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 expenses Administration Cost Formulas $240q $65q $31q $18q $560 $12q $1,500 + $5g $3,320 + $4q 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.) TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Actual Revenue and Spending Flexible Variances Activity Variances Planning Budget Results Budget Lessons 155 155 150 Revenue $ 36,970 $ 36,000 Expenses Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration $ 9,920 4,805 3,270 2,530 2,205 3,815 26,545 $ 10,425 9,750 4,650 2,700 2,360 2,250 3,920 25,630 $ 10,370 otal expense Net operating income

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