Ayayai Company uses budgets in controlling costs. The August 2017 budget report for the company's Assembling Department is as follows. AYAYAI COMPANY Budget Report Assembling Department For the Month Ended August 31, 2017 Difference Favorable Unfavorable Manufacturing Costs Budget Actual Variable costs Direct materials $54,180 $53,080 $1,100 Favorable Direct labor 60,480 57,080 3,400 Favorable Indirect materials 30,240 30,440 200 Unfavorable Indirect labor 21,420 21,020 400 Favorable Utilities 18,900 18,800 100 Favorable Maintenance 10,080 10,440 360 Unfavorable Total variable 195,300 190,860 4,440 Favorable Fixed costs Rent 11,100 11,100 -0- Supervision 16,000 16,000 -0- Depreciation 6,800 6,800 -0- Total fixed 33,900 33,900 -0- Total costs $229,200 $224,760 $4,440 Favorable The monthly budget amounts in the report were based on an expected production of 63,000 units per month or 756,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 61,000 units were produced. AYAYAI COMPANY Assembling Department Flexible Budget Report V Difference Favorable Unfavorable Neither Favorable nor Unfavorable Budget Actual Costs $ $ $ V $ $ $ Depreciation Direct Labor Direct Materials Fixed Costs Indirect Labor Indirect Materials Maintenance Rent Supervision Total Costs Total Fixed Costs Total Variable Costs Units Utilities Variable Costs Favorable Unfavorable Neither Favorable nor Unfavorable