A report for Easterly Corporation's production department for the month of May follows: Production Department Cost Report For the Month Ended May 31 Actual Planning Results Budget 25,000 30,000 Variances Machine-hours $ 6, 600 $ 19,600 61,400 7.200 21.000 70,500 $ 600 F 1.400 F 9,100 E Variable costs: Supplies Scrap Indirect materials Fixed costs: Wages and salaries Equipment depreciation Total cost 2,700 U 66.700 64.000 94,000 94,000 $ 248,300 $256, 700 $8,400 F After receiving a copy of this cost report, the supervisor of the Production 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. Required: 1. The company's president Is uneasy about the cost reports, Identify at least two reasons. 2. What kind of reports should be used to give better Insight into how well departmental supervisors are controlling costs? 3. Complete the new performance report for the month of May, based on Flexible Budget Performance approach. 4. Were costs well controlled in May? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 4 Prepare a new performance report for the month of May. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Easterly Corporation Production Department Flexible Budget Performance Report For the Month Ended May 31 Actual Flexible Results Budget 25,000 Planning Budget Machine-hours (g) 30,000 Supplies Scrap Indirect materials Wages and salaries Equipment depreciation $ 6,600 19,800 61,400 68,700 94,000 | $ 248,300 $ 7,200 21,000 70,500 64.000 94.000 $ 256,700 Total