BE-3 In Rooney Company, direct labor is $20 per hour. The company expects to operate at 10,000 direct labor hours each month. In January 2017, direct labor totaling $206,000 is incurred in working 10,400 hours. Prepare (a) a static budget report and (b) a exible budget report. Evaluate the Usefulness of each report.

BE-12 Presented below is information related to the Southern Division of Lumber, Inc.Contribution margin $1,200,000Controllable margin $ 800,000Average operating assets $4,000,000Minimum rate of return 15%Compute the Southern Divisions return on investment and residual income.