D Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are...
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D Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Cost Formulas $16.50q $4,400 +$1.60q $5,400 + $0.50q Supplies Equipment depreciation Factory rent k Property taxes Factory administration $1,200+ $0.30q $18,200+ $2.60q $8,600 $2,900 $13,500+ $0.70q The Production Department planned to work 4,500 labor-hours in March; however, it actually worked 4,300 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities ces Supplies Actual Cost Incurred in March $ 72,570 $ 10,780 $ 8,040 $ 2,760 $ 29,380 $ 9,000 $ 2,900 $ 15,880 Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Calculate the spending variances for all expense items. D Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Cost Formulas $16.50q $4,400 +$1.60q $5,400 + $0.50q Supplies Equipment depreciation Factory rent k Property taxes Factory administration $1,200+ $0.30q $18,200+ $2.60q $8,600 $2,900 $13,500+ $0.70q The Production Department planned to work 4,500 labor-hours in March; however, it actually worked 4,300 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities ces Supplies Actual Cost Incurred in March $ 72,570 $ 10,780 $ 8,040 $ 2,760 $ 29,380 $ 9,000 $ 2,900 $ 15,880 Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Calculate the spending variances for all expense items.
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Lets go through each requirement step by step 1 Prepare the Production Departments planning budget for the month Planning Budget Formula Direct labor ... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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