Part 2. Problems. There are five problems and one bonus problem. Each one is worth the score indicated next to the problem number. Show all work for complete credit. You may attach extra pages if you so desire. Please be NEAT when writing your answers. I cannot grade illegible answers. (40 points possible) 1. (8 points) Pie Guys Pizzeria is owned and operated by three brothers. Data concerning the pizzeria's monthly revenues and costs appear below (q refers to the number of pizzas served): Revenue Cost of ingredients Rent Utilities Salaries Miscellaneous Formula $14.159 $4.600 $2,050 $300 + $0.157 $6,000 $500 + $.65q Actual results for February appear below. Prepare a flexible budget performance report for the pizzeria for February for 1,300 pizzas. Revenue $18,500 Cost of ingredients 6,100 Rent 2,050 Utilities 608 Salaries 6,200 Miscellaneous 1,050 Required: a. Prepare a budget for 1.400 pizzas (this is the planning budget). b. Prepare a budget for 1,300 pizzas (this is the flexible budget). c. Compute the activity variances between the two budgets and revenue/spending variances between the actual data and the flexible budget. Also indicate whether the variance is favorable or unfavorable. Actual Units Actual Results Revenue & Spending Variances Flexible Budget Activity Variances Planning Budget Revenue Expenses: Cost of ingredients Rent Utilities Salaries Miscellaneous Total expenses Net operating income