Refer to DCdesserts.com’s activity-based flexible budget in Exhibit 11–11. Suppose that the company’s activity in June is described as follows Process hours ............................................................................................................................................... 7,500 Production runs ............................................................................................................................................ 16 New products tested .................................................................................................................................... 30 Direct material handled (pounds) ................................................................................................................ 40,000 Required:
1. Determine the flexible budgeted cost for each of the following:

a. Indirect material

b. Utilities

c. Inspection

d. Test kitchen

e. Material handling

f. Total overhead cost 2. Compute the variance for setup cost during the month, assuming that the actual setup cost was $3,000:

a. Using the activity-based flexible budget.

b. Using DCdesserts.com’s conventional flexible budget (Exhibit 11–3).