Question
Flexible Budget for Varying Levels of Activity Nashler Company has the following budgeted variable costs per unit produced: Direct materials $7.20 Direct labor 1.54 Variable
Flexible Budget for Varying Levels of Activity
Nashler Company has the following budgeted variable costs per unit produced:
Direct materials | $7.20 |
Direct labor | 1.54 |
Variable overhead: | |
Supplies | 0.23 |
Maintenance | 0.19 |
Power | 0.18 |
Budgeted fixed overhead costs per month include supervision of $98,000, depreciation of $76,000, and other overhead of $245,000.
In March, Nashler Company produced 160,000 units and had the following actual costs:
Direct materials | $1,148,000 |
Direct labor | 252,900 |
Supplies | 37,300 |
Maintenance | 30,340 |
Power | 28,730 |
Supervision | 99,400 |
Depreciation | 76,000 |
Other overhead | 244,300 |
Required:
1. Prepare a performance report for Nashler Company comparing actual costs with the flexible budget for actual units produced. If there is no variance, enter "0" for the amount and select "NA" in the last column.
Nashler Company Performance Report | ||||
Actual Cost | Flexible Budget Cost | Variance | ||
Direct materials | $ | $ | $ | |
Direct labor | ||||
Supplies | ||||
Maintenance | ||||
Power | ||||
Supervision | ||||
Depreciation | ||||
Other overhead | ||||
Total cost | $ | $ | $ | |
2. What if Nashler Companys actual direct materials cost were $1,152,000? How would that affect the variance for direct materials? If an amount is zero, enter "0". The materials variance would be $.
The total cost variance would by $.
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