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Critiquing a Variance Report

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I need help with the following problem in the attached document.
Critiquing a Variance Report:
Several years ago, Westmont Corporation developed a comprehensive budgeting system for profit planning and control purposes. While departmental supervisors have been happy with the system, the factory manager has expressed considerable dissatisfaction with the information being generated by the system. A typical departmental cost report for a recent period follows:
Assembly Department
Cost Report
For the month ended March 31
Planning Budget Actual Results Variances
Machine-hours 40,000 35,000

Variable costs:
Supplies $ 32,000 $ 29,700 $ 2,300 F
Scrap 20,000 19,500 500 F
Indirect materials 56,000 51,800 4,200 F
Fixed costs:
Wages and salaries 80,000 79,200 800 F
Equipment depreciation 60,000 60,000 - F
Total cost $248,000 $240,200 $7,800 F
After receiving a copy of this cost report, the supervisor of the Assembly Department stated, "These reports are super. It makes me feel really good to see how well things are going in my department. I can't understand why those people upstairs complain so much about the reports."
For the last several years, the company's marketing department has chronically failed to meet the sales goals expressed in the company's monthly budgets. Answer the following questions:
? The company's president is uneasy about the cost reports and would like you to evaluate their usefulness to the company.
? What changes, if any, should be made in the reports to give better insight into how well departmental supervisors are controlling costs?
? Prepare a new performance report for the quarter, incorporating any charges you suggested in question (b) above.
? How well were costs controlled in the Assembly Department in March?

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Wings flight school: Critique a Report;Prepare a Performance Report

Wings flight school offers lessons at a small municipal airport. The school's owner and manager has been attempting to evaluate performance and control costs using variance report that compares the planning budget to actual results. A recent variance appears below:
Wings flight school
Variance report
For the month ended august 31

Planning Actual Variances
Budget Results

Lessons.....................................200 210
Revenue....................................$45,000 $47,300 $2300 F
expenses:
instructor wages..........................12,400 12,910 510 U
aircraft depreciation...................11,400 11,970 570 U
Fuel.............................................4,200 5,150 950 U
maintenance................................3,270 3,470 200 U
ground facility expenses..............2,440 2,350 90 F
administration...............................4,410 4,340 70 F
Total expenses..............................38,120 40,190 2,070 U
Net operating income.....................$6,880 $7,110 $230 F

After several months of using such variance reports, the owner has become frustrated. For example, she is quite confident that instructor wages were very tightly controlled in august, but the report shows an unfavorable variance.

The planning budget was developed using the following formulas, where q is the
number of lessons sold:

Revenue............................$225q
Instructor wages.................$62q
Aircraft depreciation..........$57q
Fuel.....................................$21q
Maintenance........................$670+$13q
Ground facility expenses......$1640+$4q
Administration.......................$4210+$1q

Required:
1.Should the owner feel frustrated with the variance reports?Explain
2.Prepare a flexible budget performance report for the school for August
3.Evaluate the school's performance for August

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