Closure Company and Pull Company are seeking your assistance with compiling flexible budgets, performance reports, and overhead variances.

Directions: Each part of this assignment should be prepared as a separate sheet in one Excel file. Please change the sheet names at the bottom of the page to the part section. Then, follow the directions for each part below. Be sure to show your calculations and label your work for full credit.

Part A

You have recently been hired by Closure Company, which produces windows for personal homes. Based on the following information prepare a flexible budget for 3000, 3500 and 4000 units.

Direct Materials per Unit: $15.00

Direct Labor per Unit: $20.00

Variable Overhead Cost per Unit: $5.00

Fixed Overhead: $50,000 per year

Part B

Based on the flexible budget from scenario 1, prepare a performance report if the company has the following actual costs for 3,500 units this month:

Actual production was 3,500 units.

Actual Direct Materials were $53,000

Actual Direct Labor costs were $69,500

Actual Variable Overhead costs were $18,000

Actual Fixed Overhead costs were $50,000

Part C

Pull Company has the following information for the month. Compute the Variable Overhead Spending Variance, Variable Overhead Efficiency Variance and the Total Variable Overhead Variance based on the following information:

Standard Variable Overhead rate: $5.00 per Direct Labor Hour

Actual Variable Overhead Costs: $9,000

Standard hours allowed per unit: .50 hours

Actual direct labor hours worked: 1,700 hours

Units produced: 3,500