A report for Easterly Corporation's production department for the month of May follows: Production Department Cost Report For the Mon tu planning May 31 Results Budget 30,000 Variances Machine-hours 25,000 Variable costs: Supplies Scrap Indirect materials 6,900 $ 7,500 $ 22,500 75,000 600 F 21,000 65,000 1,500 F 10,000 F Fixed costs: 65,000 95,000 Wages and salaries 67,900 2,900 U Equipment depreciation 95,000 255,800 $ 265,000 9, 200 F Total cost 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