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:

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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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 ($2.20g)
Wages and salaries ($6,300 + $0.20q)
Utilities ($2,000 + $0.05q)
Facility rent ($3,200)
Insurance ($2,700)
Miscellaneous ($700+ $0.10q)
Total expense
Net operating income
Budgeted meals (q)
Revenue ($4.20g)
In July, 30,000 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
Expenses:
Raw materials ($2.20g)
Wages and salaries ($6,300+ $0.20q)
Utilities ($2,000+ $0.05q)
Facility rent ($3,200)
Insurance ($2,700)
29,000
$ 121,800
Miscellaneous ($700 + $0.10q)
Total expense
Net operating income
63,800
12, 100
3,450
3,200
2,700
3,600
88,850
$ 32,950
30,000
$ 126,000
66,000
12,300
3,500
3,200
2,700
3,700
91,400
$ 34,600
Required:
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.)
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 ($2.20g) Wages and salaries ($6,300 + $0.20q) Utilities ($2,000 + $0.05q) Facility rent ($3,200) Insurance ($2,700) Miscellaneous ($700+ $0.10q) Total expense Net operating income Budgeted meals (q) Revenue ($4.20g) In July, 30,000 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 Expenses: Raw materials ($2.20g) Wages and salaries ($6,300+ $0.20q) Utilities ($2,000+ $0.05q) Facility rent ($3,200) Insurance ($2,700) 29,000 $ 121,800 Miscellaneous ($700 + $0.10q) Total expense Net operating income 63,800 12, 100 3,450 3,200 2,700 3,600 88,850 $ 32,950 30,000 $ 126,000 66,000 12,300 3,500 3,200 2,700 3,700 91,400 $ 34,600 Required: 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.)
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