AccountingFlight Café prepares in-flight meals for airlines in its kitchen located next to a local airport. The company's planning budget for Julyappears below:Flight CaféPlanning BudgetFor the Month Ended July 31Budgeted meals (g)28,000Revenue ($4.40g)$ 123,200Expenses:Raw materials ($1.80g)50,400Wages and salaries ($6,200 + $0.20g)11,800Utilities ($1,900+ $0.05g)3,300Facility rent ($3,800)3,800Insurance ($2,900)2,900Miscellaneous ($800 + $0.10g)3,600Total expense75,800Net operating income$ 47,400In July, 29,000 meals were actually served. The company's flexible budget for this level of activity appears below:Flight CaféFlexible BudgetFor the Month Ended July 31Budgeted meals (g)29,000Revenue ($4.40g)$ 127,600Expenses:Raw materials ($1.80g)52, 200Wages and salaries ($6,200+ $0.20g)12,000Utilities ($1,900+ $0.05g)3,350Facility rent ($3,800)3,800Insurance ($2,900)2,900Miscellaneous ($800+ $0.10g)3,700Total expense77,950Net operating income$ 49,650Net operating income$ 49,650tequired:Calculate the company's activity variances for July. (Indicate the effect of each variance by selecting "F" for favorable, "U" forinfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)Flight CaféActivity VariancesFor the Month Ended July 31RevenueExpenses:Raw materialsWages and salariesUtilitiesFacility rentInsuranceMiscellaneousTotal expenseNet operating income

Variance analysis is an evaluation of the discrepancy between planned and actual data. The sum of…

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 (g) 28,000 $ 123,200 Revenue ($4.40g) Expenses: Raw materials ($1.80g) 50,400 Wages and salaries ($6,200 + $0.20g) 11,800 Utilities ($1,900+ $0.05g) 3,300 Facility rent ($3,800) 3,800 Insurance ($2,900) 2,900 Miscellaneous ($800+ $0.10g) Total expense 3,600 75,800 Net operating income $ 47,400 In July, 29,000 meals were actually served. The company's flexible budget for this level of activity appears below:

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 (g) 28,000 $ 123,200 Revenue ($4.40g) Expenses: Raw materials ($1.80g) 50,400 Wages and salaries ($6,200 + $0.20g) 11,800 Utilities ($1,900+ $0.05g) 3,300 Facility rent ($3,800) 3,800 Insurance ($2,900) 2,900 Miscellaneous ($800+ $0.10g) Total expense 3,600 75,800 Net operating income $ 47,400 In July, 29,000 meals were actually served. The company's flexible budget for this level of activity appears below:

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 is a company that prepares in-flight meals for airlines in its kitchen located next to the localairport. The company’s planning budget for July follows:bre27076_ch08_358-395.indd 378 7/23/09 4:11:10 PMConfi rming Pages379Flight CaféPlanning BudgetFor the Month Ended July 31Budgeted meals (q) ................................................ 18,000Revenue ($4.50q) ................................................... $81,000Expenses:Raw materials ($2.40q) ....................................... 43,200Wages and salaries ($5,200 $0.30q) .............. 10,600Utilities ($2,400 $0.05q) .................................. 3,300Facility rent ($4,300) ............................................ 4,300Insurance ($2,300) .............................................. 2,300Miscellaneous ($680 $0.10q) .......................... 2,480Total expense ......................................................... 66,180Net operating income .............................................. $14,820In…
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