Analysis of cost reports (CM A adapted). Veronica is the production manager of the Bellmont Plant, a division of the larger corporation, Radion, Inc. Veronica has complained several times to the corporate office that their cost reports used to evaluate her plant are misleading. She states, "I know how to get good quality product out.

Over a number of years, I've even cut raw materials used to do it. The cost reports don't show any of this; they're always negative, no matter what I do. There's no way you can win with accounting or the people at headquarters who use these reports."

A copy of the latest report is shown below.

Identify and explain changes to the report that would make the cost information more meaningful to the production managers.

Transcribed Image Text:

BELLMONT PLANT Cost Report Month of November (in thousands) Raw Material.. Direct Labor Overhead Total Master Actual Excess Budget Cost Cost $ 500 $ 550 $ 50 700 650 (50) 150 180 30 $1,350 $1,380 $ 30