Flight Café prepares in-flight meals for airlines in its kitchen located next to a local airport. The company's 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 ($1.909) Wages and salaries ($6,300 + $0.209) Utilities ($2,000 + $0.059) Facility rent ($3,100) Insurance ($2,100) Miscellaneous ($800 + $0.109) Total expense Net operating income 21,000 $ 88,200 39,900 10,500 3,050 3,100 2,100 2,900 61,550 $ 26,650 In July, 22,000 meals were actually served. The company's flexible budget for this level of activity appears below: Budgeted meals (q) Revenue ($4.20q) Expenses: Flight Café Flexible Budget For the Month Ended July 31 Raw materials ($1.909) Wages and salaries ($6,300+ $0.209) Utilities ($2,000 + $0.059) Facility rent ($3,100) Insurance ($2,100) Miscellaneous ($800 + $0.109) Total expense Net operating income Required: 22,000 $ 92,400 41,800 10,700 3,100 3,100 2,100 3,000 63,800 $ 28,600 1. Calculate the company's activity variances 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.) Flight Café Activity Variances For the Month Ended July 31 Revenue Expenses: Raw materials Wages and salaries Utilities Facility rent Insurance Miscellaneous Total expense Net operating income

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Flight Café prepares in-flight meals for airlines in its kitchen located next to a local airport. The company's 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 ($1.909)
Wages and salaries ($6,300 + $0.209)
Utilities ($2,000 + $0.059)
Facility rent ($3,100)
Insurance ($2,100)
Miscellaneous ($800 + $0.109)
Total expense
Net operating income
21,000
$ 88,200
39,900
10,500
3,050
3,100
2,100
2,900
61,550
$ 26,650
In July, 22,000 meals were actually served. The company's flexible budget for this level of activity appears below:
Budgeted meals (9)
Revenue ($4.20q)
Expenses:
Flight Café
Flexible Budget
For the Month Ended July 31
Raw materials ($1.909)
Wages and salaries ($6,300+ $0.209)
Utilities ($2,000 + $0.059)
Facility rent ($3,100)
Insurance ($2,100)
Miscellaneous ($800 + $0.109)
Total expense
Net operating income
Required:
22,000
$ 92,400
41,800
10,700
3,100
3,100
2,100
3,000
63,800
$ 28,600
1. Calculate the company's activity variances 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.)
Flight Café
Activity Variances
For the Month Ended July 31
Revenue
Expenses:
Raw materials
Wages and salaries
Utilities
Facility rent
Insurance
Miscellaneous
Total expense
Net operating income
Transcribed Image Text:Flight Café prepares in-flight meals for airlines in its kitchen located next to a local airport. The company's 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 ($1.909) Wages and salaries ($6,300 + $0.209) Utilities ($2,000 + $0.059) Facility rent ($3,100) Insurance ($2,100) Miscellaneous ($800 + $0.109) Total expense Net operating income 21,000 $ 88,200 39,900 10,500 3,050 3,100 2,100 2,900 61,550 $ 26,650 In July, 22,000 meals were actually served. The company's flexible budget for this level of activity appears below: Budgeted meals (9) Revenue ($4.20q) Expenses: Flight Café Flexible Budget For the Month Ended July 31 Raw materials ($1.909) Wages and salaries ($6,300+ $0.209) Utilities ($2,000 + $0.059) Facility rent ($3,100) Insurance ($2,100) Miscellaneous ($800 + $0.109) Total expense Net operating income Required: 22,000 $ 92,400 41,800 10,700 3,100 3,100 2,100 3,000 63,800 $ 28,600 1. Calculate the company's activity variances 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.) Flight Café Activity Variances For the Month Ended July 31 Revenue Expenses: Raw materials Wages and salaries Utilities Facility rent Insurance Miscellaneous Total expense Net operating income
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