Electric Company estimates that 360,000 direct labor hours will be worked during 2019 in the Fixing Department. On this basis, the following budgeted manufacturing overhead data are computed.

Variable Overhead Costs
Indirect labor	$72,000
Indirect material	54,000
Repairs	36,000
Utilities	28,800
Lubricants	18,000
Total	$208,800

Fixed Overhead Costs (annually)
Supervision	$75,000
Depreciation	30,000
Insurance	12,000
Rent	9,000
Property taxes	6,000
Total	$132,000

It is estimated that direct labor hours worked each month will range from 18,000 to 24,000 hours. During January, 20,000 direct labor hours were worked, and the following overhead costs were incurred.

Variable Overhead Costs
Indirect labor	$6,300
Indirect material	2,500
Repairs	2,700
Utilities	1,900
Lubricants	830
Total	$14,230

Fixed Overhead Costs
Supervision	$6,250
Depreciation	2,500
Insurance	1,000
Rent	850
Property taxes	500
Total	$11,100

Instructions:

1. Prepare a monthly flexible manufacturing overhead budget for each increment of 2,000 direct labor hours over the relevant range for the year ending December 31, 2019.
2. Prepare a manufacturing overhead budget report for January.
3. Comment on managements efficiency in controlling manufacturing overhead costs in January.