ation of Canada CGA Canada) al Accountants of Canada, Toror the publisher and have not been CGA Canada of Canada, Toronto, dhave not been reviewed Sevined tary Control and Responsibility Accounting und P1100A (L01,2,3) Laesecke Company uses budgets to control costs. The May 2020 budget report for the company's packaging department is as follows: Excel LAESECKE COMPANY Budget Report Packaging Department Month Ended May 31, 2020 Difference: Favourable (F/ Unfavourable (U) Budget Actual Manufacturing Costs Variable costs Direct materials Direct labour Indirect materials Indirect labour Utilities Maintenance Total variable costs Fixed costs Rent Supervision Depreciation Total fixed costs Total costs S 37.500 45,000 15,000 12.500 10,000 5.000 125,000 $ 38,000 47.000 15.200 13.000 9,600 5.200 128,000 $ SOOU 2.000 U 200 U SOOU 400 F 200 U 3.000 U 10,000 7.000 10,000 7.000 5.000 22.000 $147,000 5.000 22.000 SI50,000 $3.000 U The monthly budget amounts in the report were based on an expected production of 50.000 units per month or 600,000 units per year. The company president was unhappy with the department manager performance. The department manager could not understand the unfavourable results. In May. 55.000 units were produced Instructions a. State the total budgeted cost formula. b. Prepare a budget report for May, using flexible budget data. Why does this report provide a better basis for evaluating performance than the report based on static budget data? c. In June, 40,000 units were produced, Prepare the budget report using flexible budget data, assuming (1) cach variable cost was 20% less in June than its actual cost in May, and (2) fixed costs were the same in the month of June as in May. P11.41A (LO 3) Korene Manufacturing Inc. operates the home appliance division as a profit centre. Operating data for this division for the year ended December 31, 2020, are shown in the following table ation of Canada CGA Canada) al Accountants of Canada, Toror the publisher and have not been CGA Canada of Canada, Toronto, dhave not been reviewed Sevined tary Control and Responsibility Accounting und P1100A (L01,2,3) Laesecke Company uses budgets to control costs. The May 2020 budget report for the company's packaging department is as follows: Excel LAESECKE COMPANY Budget Report Packaging Department Month Ended May 31, 2020 Difference: Favourable (F/ Unfavourable (U) Budget Actual Manufacturing Costs Variable costs Direct materials Direct labour Indirect materials Indirect labour Utilities Maintenance Total variable costs Fixed costs Rent Supervision Depreciation Total fixed costs Total costs S 37.500 45,000 15,000 12.500 10,000 5.000 125,000 $ 38,000 47.000 15.200 13.000 9,600 5.200 128,000 $ SOOU 2.000 U 200 U SOOU 400 F 200 U 3.000 U 10,000 7.000 10,000 7.000 5.000 22.000 $147,000 5.000 22.000 SI50,000 $3.000 U The monthly budget amounts in the report were based on an expected production of 50.000 units per month or 600,000 units per year. The company president was unhappy with the department manager performance. The department manager could not understand the unfavourable results. In May. 55.000 units were produced Instructions a. State the total budgeted cost formula. b. Prepare a budget report for May, using flexible budget data. Why does this report provide a better basis for evaluating performance than the report based on static budget data? c. In June, 40,000 units were produced, Prepare the budget report using flexible budget data, assuming (1) cach variable cost was 20% less in June than its actual cost in May, and (2) fixed costs were the same in the month of June as in May. P11.41A (LO 3) Korene Manufacturing Inc. operates the home appliance division as a profit centre. Operating data for this division for the year ended December 31, 2020, are shown in the following table
