Flexible Budget Application

The polishing department of Taylor Manufacturing Company operated during April with the following manufacturing overhead cost budget based on $4,000$ hours of monthly productive capacity:

Taylor Manufacturing Company

Polishing Department

Overhead Budget $(4,000$ Hours$)$

For the Month of April

Variable costs:

Factory supplies $$100,000$

Indirect labor $152,000$

Utilities $68,000$

Patent royalties on secret process $296,000$

Total variable overhead $$616,000$

Fixed costs:

Supervisory salaries $160,000$

Depreciation on factory equipment $144,000$

Factory taxes $48,000$

Factory insurance $32,000$

Utilities $($base charge$)80,000$

Total fixed overhead $464,000$

Total manufacturing overhead $$1,080,000$

The polishing department was operated for $4,600$ hours during April and incurred the following manufacturing overhead costs:

Factory supplies $$97,520$

Indirect labor $136,160$

Utilities $($usage factor$)82,800$

Utilities $($base factor$)96,000$

Patent royalties $280,416$

Supervisory salaries $168,000$

Depreciation on factory equipment $144,000$

Factory taxes $56,000$

Factory insurance $32,000$

Total manufacturing overhead incurred $$1,092,896$

Using a flexible budgeting approach, prepare a performance report for the polishing department for April, comparing actual overhead costs with budgeted overhead costs for $4,600$ hours. Separate overhead costs into variable and fixed components and show the amounts of any variances between actual and budgeted amounts.

Do not use negative signs with your answers below.

Do not round until your final answer. Round answers to nearest whole number, if applicable.

Select either U for Unfavorable or F for Favorable using the drop down box next to each of your variance answers.