Vulcan Flyovers offers scenic overflights of Mount St. 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

Results

Flexible

Budget

Planning

Budget

Flights (q)

60

60

58

Revenue ($355.00q)

$

16,300

$

21,300

$

20,590

Expenses:

Wages and salaries ($3,500 + $90.00q)

8,860

8,900

8,720

Fuel ($31.00q)

2,028

1,860

1,798

Airport fees ($820 + $31.00q)

2,550

2,680

2,618

Aircraft depreciation ($11.00q)

660

660

638

Office expenses ($220 + $1.00q)

448

280

278

Total expense

14,546

14,380

14,052

Net operating income

$

1,754

$

6,920

$

6,538

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.)