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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 TipTop Flight School Variance Report For the Month Ended July 31 Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Actual Results 155 $ 33,900 9,870 5,890 2,750 2,450 1,540 3,320 25,820 $ 8,080 $220q $65q $380 $15q $530+ $129 Actual $1,250 + $29 $3,240 + $19 Planning Budget 150 $ 33,000 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 g is the number of lessons sold: Cost Formulas 9,750 5,708 2,250 2,330 1,550 3,390 24,978 $ 8,030 Variances $ 988 F 120 U 190 U 500 U 120 U 10 F 78 F 850 U $ 58 F Required: 2. Complete the flexible budget performance report for the school for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values.) TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Flexible Planning

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 TipTop Flight School Variance Report For the Month Ended July 31 Revenue Instructor wages Aircraft depreciation Fuel Maintenance Ground facility expenses Administration Actual Results 155 $ 33,900 9,870 5,890 2,750 2,450 1,540 3,320 25,820 $ 8,080 $220q $65q $380 $15q $530+ $129 Actual $1,250 + $29 $3,240 + $19 Planning Budget 150 $ 33,000 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 g is the number of lessons sold: Cost Formulas 9,750 5,708 2,250 2,330 1,550 3,390 24,978 $ 8,030 Variances $ 988 F 120 U 190 U 500 U 120 U 10 F 78 F 850 U $ 58 F Required: 2. Complete the flexible budget performance report for the school for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values.) TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Flexible Planning

FINANCIAL ACCOUNTING
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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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. Actual Results 155 $ 33,900 The planning budget was developed using the following formulas, where g is the number of lessons sold: Cost Formulas $2209 $65q $389 $15q $530+ $129 $1,250 + $29 $3,240+ $1q 155 $ 33,900 9,870 5,890 2,750 9.870 5,890 2,750 2,450 1,540 3,320 2,450 1,540 3,320 25,820 $ 8,080 25,820 $ 8,080 Planning Budget 150 $ 33,000 Required: 2. Complete the flexible budget performance report for the school for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values.) 9,750 5,708 2,250 2,330 1,550 3,398 24,970 $ 8,030 TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Variances $ 900 F 120 U 190 U 500 U 120 U 10 F 78 F 850 U $ 50 F Flexible Budget Planning Budget 150 $ 33,000 9,750 5,700 2,250 2,330 1,550 3,390 24,970 $ 8,030
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 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. Actual Results 155 $ 33,900 The planning budget was developed using the following formulas, where g is the number of lessons sold: Cost Formulas $2209 $65q $389 $15q $530+ $129 $1,250 + $29 $3,240+ $1q 155 $ 33,900 9,870 5,890 2,750 9.870 5,890 2,750 2,450 1,540 3,320 2,450 1,540 3,320 25,820 $ 8,080 25,820 $ 8,080 Planning Budget 150 $ 33,000 Required: 2. Complete the flexible budget performance report for the school for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values.) 9,750 5,708 2,250 2,330 1,550 3,398 24,970 $ 8,030 TipTop Flight School Flexible Budget Performance Report For the Month Ended July 31 Variances $ 900 F 120 U 190 U 500 U 120 U 10 F 78 F 850 U $ 50 F Flexible Budget Planning Budget 150 $ 33,000 9,750 5,700 2,250 2,330 1,550 3,390 24,970 $ 8,030
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