Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

undefined 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

image text in transcribedimage text in transcribedundefined

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 210 Planning Budget 205 Variances Lessons $ 52,230 $ 51,250 $ 980 F Revenue Expenses: Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Total expense Net operating income 14,530 14,350 6,720 6,560 3,655 3,075 3,415 3,235 1,910 1,960 3,435 3,545 33,665 32,725 $ 18,565 $ 18,525 $ 180 U 160 U 580 U 180 U 50 F 110 F 940 U 40 F 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 $250 Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration $709 $329 $159 $570 + $ 139 $1,550 + $29 $3,340 + $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.) 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 Actual Revenue and Results Spending Variances 210 Flexible Budget Activity Variances Planning Budget 205 Lessons Revenue $ 52,230 $ 4,020 XU $ 225 X $5,000 XF $ 51,250 Expenses: Instructor wages 14,530 56,250 X 1,400 X U (1,220) XF (480) None 14,350 6,560 Aircraft depreciation 6,720 640 XU Fuel 3,655 280 X U 300 X U 3,075 Maintenance 260 U 3,415 1,910 3,235 1,960 OOOOOOOO Ground facility expenses 40 XU (80) U (90) XF (130) XF (1,720) XU Administration lololo 20 8|U 3,435 33,665 $ 18,565 Total expense 2,660 x U 3,545 32,725 $ 18,525 Net operating income $ (2,300) XU $ 2,340 XF

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

More Books

Students also viewed these Accounting questions

Question

b. Predict lichen N for an NO 3 deposition value of .5.

Answered: 1 week ago