Reference no: EM131791827

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
Budgeted meals (q)	30,000
Revenue ($3.80q)	$	114,000
Expenses:
Raw materials ($2.20q)	66,000
Wages and salaries ($6,500 + $0.20q)	12,500
Utilities ($1,800 + $0.05q)	3,300
Facility rent ($3,800)	3,800
Insurance ($2,300)	2,300
Miscellaneous ($400 + $0.10q)	3,400
Total expense	91,300
Net operating income	$	22,700

In July, 31,000 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
Budgeted meals (q)	31,000
Revenue ($3.80q)	$	117,800
Expenses:
Raw materials ($2.20q)	68,200
Wages and salaries ($6,500 + $0.20q)	12,700
Utilities ($1,800 + $0.05q)	3,350
Facility rent ($3,800)	3,800
Insurance ($2,300)	2,300
Miscellaneous ($400 + $0.10q)	3,500
Total expense	93,850
Net operating income	$	23,950

Required:

1. Compute 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.)