Problem 11.39

# Problem 11.39 - PROBLEM 11-39 1 Activity Level(Air Miles...

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PROBLEM 11-39 1. Activity Level (Air Miles) 32,000 35,000 38,000 Variable expenses: Fuel. ......................................................... \$ 16,000 \$ 17,500 \$ 19,000 Aircraft maintenance. ............................. 24,000 26,250 28,500 Flight crew salaries. ................................ 12,800 14,000 15,200 Selling and administrative. .................... 25,600 28,000 30,400 Total variable expenses. ................. \$ 78,400 \$ 85,750 \$ 93,100 Fixed expenses: Depreciation on aircraft. ......................... \$ 2,900 \$ 2,900 \$ 2,900 Landing fees. ........................................... 900 900 900 Supervisory salaries. .............................. 9,000 9,000 9,000 Selling and administrative. .................... 11,000 11,000 11,000 Total fixed expenses. ...................... \$ 23,800 \$ 23,800 \$ 23,800 Total expenses. ............................................ \$102,200 \$109,550 \$116,900 2. First, there is a large unfavorable variance in passenger revenue, reflecting the fact

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Problem 11.39 - PROBLEM 11-39 1 Activity Level(Air Miles...

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