Vulcan Flyovers offers scenic overflights of Mount Saint Helens, the volcano in Washington State that explosively erupted in 1982. Data concerning the company's operations in July appear below: Vulcan Flyovers Operating Data For the Month Ended July 31 Actual Flexible Planning Results Budget Budget Flights (9) 48 48 50 $ $ $ Revenue ($320.00) 13,650 15,360 16,000 Expenses: Wages and salaries ($4,000 + $82.00) 8, 430 7,936 8,100 Fuel ($23.00) 1,260 1,104 1,150 Airport fees ($650 + $38.009) 2,350 2,474 2,550 Aircraft depreciation ($7.009) 336 350 Office expenses ($190 + $2.009) 460 286 290 Total expense 12,836 12,136 12,440 Net operating income $ 814 $ 3, 224 $ 3,560 336 The company measures its activity in terms of flights. Customers can buy individual tickets for overflights or hire an entire plane for an overflight at a discount. Required: 1. Prepare a flexible budget performance report for July that includes revenue and spending variances and activity variances. (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.) Vulcan Flyovers Flexible Budget Performance Report For the Month Ended July 31 Actual Flexible Results Budget 48 48 $13,650 $ 1,710 $ 15,360 Planning Budget 50 $ 16,000 8,430 7,936 8,100 Flights Revenue Expenses: Wages and salaries Fuel Airport fees Aircraft depreciation Office expenses Total expense Net operating income 1,260 2,350 1,104 2,474 1,150 2,550 336 336 350 460 12,836 286 12,136 290 12,440 $ 814 $ 3,224 $ 3,560 Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost driversthe number of cruises and the number of passengers-that it uses in its budgeting and performance reports. The company publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 80 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Cost per Cost per Cruise Passenger $ $ 2.00 480.00 Vessel operating costs Advertising Administrative costs Fixed Cost per Month $ 5,200 $ 1,700 $ 4,300 $ 2,900 $ 24.00 $ 1.00 Insurance For example, vessel operating costs should be $5,200 per month plus $480 per cruise plus $2 per passenger. The company's sales should average $25 per passenger. In July, the company provided 24 cruises for a total of 1,400 passengers. Required: Prepare the company's flexible budget for July. Alyeski Tours Flexible Budget For the Month Ended July 31 Actual cruises 24 Actual passengers 1,400 Revenue $ 35,000 Expenses: Vessel operating costs Advertising Administrative costs Insurance Total expense 0 Net operating income $ 35,000
