FINANCIAL ACCOUNTING
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ISBN: 9781259964947
Author: Libby
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![Exercise 9-2 (Algo) Activity Varlances [LO9-2]
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 ($4.40q)
Expenses:
Raw materials ($2.309)
Wages and salaries ($6,200 + $0.289)
Utilities ($2,100 + $0.059)
Facility rent ($3,100)
Insurance ($2,400)
Miscellaneous ($900 +$0.109)
Total expense
Net operating income
21,000
$ 92,400
48,300
10,400
3,150
3,100
2,400
3,000
70,350
$ 22,050
In July, 22,000 meals were actually served. The company's flexible budget for this level of activity appears below:
Budgeted meals (q)
Revenue ($4.409)
Expenses:
Raw materials ($2.309)
Flight Café
Flexible Budget
For the Month Ended July 31
22,000
$ 96,800
50,600
10,600
3,200
3,100
2,400
3,100
73,000
$ 23,800
Wages and salaries ($6,200+ $0.209)
Utilities ($2,100 + $0.059)
Facility rent ($3,100)
Insurance ($2,400)
Miscellaneous ($900 + $0.109)
Total expense
Net operating income
Required:
1. Calculate the company's activity variances for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for
unfavorable, and "None" for no effect (I.e., zero varlance). Input all amounts as positive values.)
Revenue
Expenses:
Raw materials
Flight Café
Activity Variances
For the Month Ended July 31
Wages and salaries
Utilities
Facility rent
Insurance
Miscellaneous
Total expense
Net operating income](https://content.bartleby.com/qna-images/question/ea5e1b85-5499-49e1-b515-d7fb5cde60bb/ec6bf24c-9be8-46a4-a6c6-6e07187df51d/841uzj7_processed.png)
Transcribed Image Text:Exercise 9-2 (Algo) Activity Varlances [LO9-2]
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 ($4.40q)
Expenses:
Raw materials ($2.309)
Wages and salaries ($6,200 + $0.289)
Utilities ($2,100 + $0.059)
Facility rent ($3,100)
Insurance ($2,400)
Miscellaneous ($900 +$0.109)
Total expense
Net operating income
21,000
$ 92,400
48,300
10,400
3,150
3,100
2,400
3,000
70,350
$ 22,050
In July, 22,000 meals were actually served. The company's flexible budget for this level of activity appears below:
Budgeted meals (q)
Revenue ($4.409)
Expenses:
Raw materials ($2.309)
Flight Café
Flexible Budget
For the Month Ended July 31
22,000
$ 96,800
50,600
10,600
3,200
3,100
2,400
3,100
73,000
$ 23,800
Wages and salaries ($6,200+ $0.209)
Utilities ($2,100 + $0.059)
Facility rent ($3,100)
Insurance ($2,400)
Miscellaneous ($900 + $0.109)
Total expense
Net operating income
Required:
1. Calculate the company's activity variances for July. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for
unfavorable, and "None" for no effect (I.e., zero varlance). Input all amounts as positive values.)
Revenue
Expenses:
Raw materials
Flight Café
Activity Variances
For the Month Ended July 31
Wages and salaries
Utilities
Facility rent
Insurance
Miscellaneous
Total expense
Net operating income
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