ces Exercise 9-2 (Algo) Activity Variances [LO9-2] Flight Café prepares in-flight meals for airlines and its planning budget for July appears below: Flight Café Planning Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.20q) Expenses: Raw materials ($1.90q) Wages and salaries ($6,300 + $0.20q) Utilities ($1,800 + $0.05q) Facility rent ($3,900) Insurance ($2,400) Miscellaneous ($300 + $0.10q) Total expenses Net operating income 26,000 $ 109,200 49,400 11,500 3,100 3,900 2,400 2,900 73,200 $ 36,000 In July, 27,000 meals were actually served. The company's flexible budget for this level of activity appears below: Flight Café Flexible Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.20g) Expenses: Raw materials ($1.90g) Wages and salaries ($6,300+ $0.20q) Utilities ($1,800 + $0.05q) Facility rent ($3,900) Insurance ($2,400) Miscellaneous ($300 + $0.10q) Total expenses Net operating income Required: 1. Calculate the company's activity variances for July. 27,000 $ 113,400 51,300 11,700 3,150 3,900 2,400 3,000 75,450 $ 37,950 Note: 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. Revenue Expenses: Raw materials Wages and salaries Utilities Facility rent Insurance Miscellaneous Total expenses Net operating income Flight Café Activity Variances For the Month Ended July 31
ces Exercise 9-2 (Algo) Activity Variances [LO9-2] Flight Café prepares in-flight meals for airlines and its planning budget for July appears below: Flight Café Planning Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.20q) Expenses: Raw materials ($1.90q) Wages and salaries ($6,300 + $0.20q) Utilities ($1,800 + $0.05q) Facility rent ($3,900) Insurance ($2,400) Miscellaneous ($300 + $0.10q) Total expenses Net operating income 26,000 $ 109,200 49,400 11,500 3,100 3,900 2,400 2,900 73,200 $ 36,000 In July, 27,000 meals were actually served. The company's flexible budget for this level of activity appears below: Flight Café Flexible Budget For the Month Ended July 31 Budgeted meals (q) Revenue ($4.20g) Expenses: Raw materials ($1.90g) Wages and salaries ($6,300+ $0.20q) Utilities ($1,800 + $0.05q) Facility rent ($3,900) Insurance ($2,400) Miscellaneous ($300 + $0.10q) Total expenses Net operating income Required: 1. Calculate the company's activity variances for July. 27,000 $ 113,400 51,300 11,700 3,150 3,900 2,400 3,000 75,450 $ 37,950 Note: 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. Revenue Expenses: Raw materials Wages and salaries Utilities Facility rent Insurance Miscellaneous Total expenses Net operating income Flight Café Activity Variances For the Month Ended July 31
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Exercise 9-2 (Algo) Activity Variances [LO9-2]
Flight Café prepares in-flight meals for airlines and its planning budget for July appears below:
Flight Café
Planning Budget
For the Month Ended July 31
Budgeted meals (q)
Revenue ($4.20q)
Expenses:
Raw materials ($1.90q)
Wages and salaries ($6,300 + $0.20q)
Utilities ($1,800 + $0.05q)
Facility rent ($3,900)
Insurance ($2,400)
Miscellaneous ($300 + $0.10q)
Total expenses
Net operating income
26,000
$ 109,200
49,400
11,500
3,100
3,900
2,400
2,900
73,200
$ 36,000
In July, 27,000 meals were actually served. The company's flexible budget for this level of activity appears below:
Flight Café
Flexible Budget
For the Month Ended July 31
Budgeted meals (q)
Revenue ($4.20g)
Expenses:
Raw materials ($1.90g)
Wages and salaries ($6,300+ $0.20q)
Utilities ($1,800 + $0.05q)
Facility rent ($3,900)
Insurance ($2,400)
Miscellaneous ($300 + $0.10q)
Total expenses
Net operating income
Required:
1. Calculate the company's activity variances for July.
27,000
$ 113,400
51,300
11,700
3,150
3,900
2,400
3,000
75,450
$ 37,950
Note: 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.
Revenue
Expenses:
Raw materials
Wages and salaries
Utilities
Facility rent
Insurance
Miscellaneous
Total expenses
Net operating income
Flight Café
Activity Variances
For the Month Ended July 31](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8fc44233-9976-403c-aa0d-4b08e822e74b%2F8d173aed-9de1-4370-acff-49bc270c4c71%2Fuhxndo_processed.png&w=3840&q=75)
Transcribed Image Text:ces
Exercise 9-2 (Algo) Activity Variances [LO9-2]
Flight Café prepares in-flight meals for airlines and its planning budget for July appears below:
Flight Café
Planning Budget
For the Month Ended July 31
Budgeted meals (q)
Revenue ($4.20q)
Expenses:
Raw materials ($1.90q)
Wages and salaries ($6,300 + $0.20q)
Utilities ($1,800 + $0.05q)
Facility rent ($3,900)
Insurance ($2,400)
Miscellaneous ($300 + $0.10q)
Total expenses
Net operating income
26,000
$ 109,200
49,400
11,500
3,100
3,900
2,400
2,900
73,200
$ 36,000
In July, 27,000 meals were actually served. The company's flexible budget for this level of activity appears below:
Flight Café
Flexible Budget
For the Month Ended July 31
Budgeted meals (q)
Revenue ($4.20g)
Expenses:
Raw materials ($1.90g)
Wages and salaries ($6,300+ $0.20q)
Utilities ($1,800 + $0.05q)
Facility rent ($3,900)
Insurance ($2,400)
Miscellaneous ($300 + $0.10q)
Total expenses
Net operating income
Required:
1. Calculate the company's activity variances for July.
27,000
$ 113,400
51,300
11,700
3,150
3,900
2,400
3,000
75,450
$ 37,950
Note: 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.
Revenue
Expenses:
Raw materials
Wages and salaries
Utilities
Facility rent
Insurance
Miscellaneous
Total expenses
Net operating income
Flight Café
Activity Variances
For the Month Ended July 31
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