Managerial Accounting 9.3 assignment help

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Business Finance

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3. 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: Lessons Revenue TipTop Flight School Variance Report For the Month Ended July 31 Actual Results 155 $32,470 Expenses: Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Total expense Net operating income Planning Budget Variances 150 $ 31,500 $970 F 9,800 5,890 3,630 2,570 2,025 4,260 9,600 5,700 3,150 2,460 2,090 4,360 200 190 480 110 65 100 U U U U F F 28,175 27,360 815 U $ 4,295 $ 4,140 $155 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 q is the number of lessons sold: Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Cost Formulas $210q $64q $38q $21q $ 660 + $12q $1,640 + $3q $4,210 + $1q 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).) Page 1 Page 2
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TipTop Flight School
Variance Report
For the Month Ended July 31
Lessons
Revenue
Expenses:
Instructor Wages
Aircraft Depreciation
Fuel
Maintenance
Ground Facility
Administration
Total Expenses
Net Opertaing Income
...


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