Exercise 10-2 Prepare a Report Showing Activity Variances [LO2]
Flight Café is a company that prepares in-flight meals for airlines in its kitchen located next to the local airport. The company's planning budget for July appears below:
Flight Café
Planning Budget
For the Month Ended July 31
In July, 17,800 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
Budgeted meals (q)
17,800
Revenue ($4.50q)
$
80,100
Expenses:
Raw materials ($2.40q)
42,720
Wages and salaries ($5,200 + $0.30q)
10,540
Utilities ($2,400 + $0.05q)
3,290
Facility rent ($4,300)
4,300
Insurance ($2,300)
2,300
Miscellaneous ($680 + $0.10q)
2,460
Total expense
65,610
Net operating income
$
14,490
Required:
Prepare a report showing the company's activity variances for July. (Leave no cells blank - be certain to enter "0" wherever required. Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Omit the "$" sign in your response.)
Flight Café
Activity Variances
For the Month Ended July 31
Flight Café
Activity Variances
For the Month Ended July 31
Planning
Budget
Flexible
Budget
Activity Variances
Meals
18,000
17,800
Revenue ($4.50q)
$
81,000
$
80,100
$
900
U
Expenses:
Raw materials ($2.40q)
43,200
42,720
480
F
Wages and salaries ($5,200 + $0.30q)
10,600
10,540
60
F
Utilities ($2,400 + $0.05q)
3,300
3,290
10
F
Facility rent ($4,300)
4,300
4,300
0
None
Insurance ($2,300)
2,300
2,300
0
None
Miscellaneous ($680 + $0.10q)
2,480
2,460
20
F
Total expense
66,180
65,610
570
F
Net operating income
$
14,820
$
14,490
$
330
U
Question 16:Score 0.88/4
Your response
Correct response
Exercise 10-3 Prepare a Report Showing Revenue and Spending Variances [LO3]
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 8,000 pounds of oysters in August. The company's flexible budget for August appears below:
Quilcene Oysteria
Flexible Budget
For the Month Ended August 31
Actual pounds (q)
8,000
Revenue ($4.00q)
$
32,000
Expenses:
Packing supplies ($0.50q)
4,000
Oyster bed maintenance ($3,200)
3,200
Wages and salaries ($2,900 +$0.30q)
5,300
Shipping ($0.80q)
6,400
Utilities ($830)
830
Other ($450 + $0.05q)
850
Total expense
20,580
Net operating income
$
11,420
The actual results for August appear below:
Quilcene Oysteria
Income Statement
For the Month Ended August 31
Prepare a report showing the company's revenue and spending variances for August. (Input all amounts as positive values. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Omit the "$" sign in your response.)
Quilcene Oysteria
Revenue and Spending Variances
For the Month Ended August 31
Revenue and
Spending Variances
Revenue
$
1 (0%)
F (6%)
Expenses:
Packing supplies
1 (0%)
F (0%)
Oyster bed maintenance
1 (0%)
U (0%)
Wages and salaries
1 (0%)
None (0%)
Shipping
1 (0%)
F (0%)
Utilities
1 (0%)
None (0%)
Other
1 (0%)
U (6%)
Total expense
1 (0%)
U (6%)
Net operating income
$
1 (0%)
F (6%)
Exercise 10-3 Prepare a Report Showing Revenue and Spending Variances [LO3]
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 8,000 pounds of oysters in August. The company's flexible budget for August appears below:
Quilcene Oysteria
Flexible Budget
For the Month Ended August 31
Actual pounds (q)
8,000
Revenue ($4.00q)
$
32,000
Expenses:
Packing supplies ($0.50q)
4,000
Oyster bed maintenance ($3,200)
3,200
Wages and salaries ($2,900 +$0.30q)
5,300
Shipping ($0.80q)
6,400
Utilities ($830)
830
Other ($450 + $0.05q)
850
Total expense
20,580
Net operating income
$
11,420
The actual results for August appear below:
Quilcene Oysteria
Income Statement
For the Month Ended August 31
