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 Expenses: Instructor wages Aircraft depreciation Fuel Maintenance. Ground facility expenses Administration Total expense Net operating income Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Lessons Revenue Expenses: TipTop Flight School Variance Report For the Month Ended July 31 Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Total expense Net operating income Actual Results After several months of using these 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: 155 $ 36,970 Cost Formulas $240g $65q 9,920 4,805 3,270 $319 $18q $560+ $12q Actual Results 2,530 2,205 3,815 26,545 $ 10,425 $1,500+ $5g $3,320+ $4g 155 $36,970 9,920 4,805 3,270 2,530 2,205 3,815 26,545 $ 10,425 Required: 2.Complete the flexible budget performance report for the school for July. 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. Planning Budget 150 $ 36,000 TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 9,750 4,650 2,700 2,360 2,250 3,920 25,630 $ 10,370 Variances $ 970 F 170 U 155 U Flexible Budget 570 U 170 U 45 F 105 P 915 U $ 55 F Planning Budget 150 $36.000 9,750 4,650 2,700 2,360 2,250 3,920 25,630 $ 10,370
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 Expenses: Instructor wages Aircraft depreciation Fuel Maintenance. Ground facility expenses Administration Total expense Net operating income Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Lessons Revenue Expenses: TipTop Flight School Variance Report For the Month Ended July 31 Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Total expense Net operating income Actual Results After several months of using these 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: 155 $ 36,970 Cost Formulas $240g $65q 9,920 4,805 3,270 $319 $18q $560+ $12q Actual Results 2,530 2,205 3,815 26,545 $ 10,425 $1,500+ $5g $3,320+ $4g 155 $36,970 9,920 4,805 3,270 2,530 2,205 3,815 26,545 $ 10,425 Required: 2.Complete the flexible budget performance report for the school for July. 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. Planning Budget 150 $ 36,000 TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 9,750 4,650 2,700 2,360 2,250 3,920 25,630 $ 10,370 Variances $ 970 F 170 U 155 U Flexible Budget 570 U 170 U 45 F 105 P 915 U $ 55 F Planning Budget 150 $36.000 9,750 4,650 2,700 2,360 2,250 3,920 25,630 $ 10,370
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Transcribed Image Text: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
Expenses:
Instructor wages
Aircraft depreciation
Fuel
Maintenance
Ground facility expenses
Administration
Total expense
Net operating income
Revenue
Instructor wages.
Aircraft depreciation
Fuel
Maintenance
Ground facility expenses
Administration
Lessons
Revenue
TipTop Flight School
Variance Report
For the Month Ended July 31
Expenses:
Instructor wages
Aircraft depreciation
Fuel
Maintenance
Ground facility expenses
Administration
Total expense
Net operating income
After several months of using these 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:
Actual
Results
155
$36,970
Actual
Results
9,920
4,805
Cost Formulas
$240g
$65q
$31g
$18q
$560 + $12g
$1,500+ $5g
$3,320+ $4g
155
3,270
2,530
$36,970
2,205
3,815
26,545
$ 10,425
Required:
2.Complete the flexible budget performance report for the school for July.
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.
9,920
4,805
3,270
2,530
2,205
3,815
26,545
$ 10,425
Planning
Budget
150
$ 36,000
TipTop Flight School
Flexible Budget Performance Report
For the Month Ended July 31
9,750
4,650
2,700
2,360
2,250
3,920
25,630
$ 10,370
Variances
$ 970 F
170 U
155 U
570 U
170 U
45 F
105 F
915 U
$ 55 F
Flexible
Budget
Planning
Budget
150
$ 36,000
9,750
4,650
2,700
2,360
2,250
3,920
25,630
$ 10,370
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