Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Frank Weston, supervisor of the Freemont Corporation's Machining Department, was visibly upset after being reprimanded for his department's poor performance over the prior month. The

image text in transcribed
image text in transcribed
Frank Weston, supervisor of the Freemont Corporation's Machining Department, was visibly upset after being reprimanded for his department's poor performance over the prior month. The department's cost control report is given below: Freemont Corporation Machining Department Cost Control Report For the Month Ended June 30 Actual Results Planning Budget Variances Machine-hours 42.000 40,000 Direct labor wages $ 75,300 $ 73,600 $1,700 U Supplies 22,800 21,200 1,600 U Maintenance 22,800 20,500 2,300 U Utilities 20,500 19,300 1.200 U Supervision 44,000 44,000 0 Depreciation 73,000 73,000 Total $ 258.400 $251.600 $ 6,800 U "I just can't understand all of these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, I thought he was going to give me a pat on the back because I know for a fact that my department worked more efficiently last month than it has ever worked before. Instead, he tore me apart. I thought for a minute that it might be over the supplies that were stolen out of our warehouse last month. But they only amounted to a couple of hundred dollars, and just look at this report. Everything is unfavorable." Direct labor wages and supplies are variable costs; supervision and depreciation are fixed costs; and maintenance and utilities are mixed costs. The fixed component of the budgeted maintenance cost is $13,300; the fixed component of the budgeted utilities cost is $13,100. Required: 2. Complete the performance report that will help Mr. Weston's superiors assess how well costs were controlled in the machining department. (Round your intermediate calculations to 2 decimal places. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Freemont Corporation ---Machining Department Flexible Budget Performance Report For the Month Ended June 30 Actual Flexible Results Budget 42.000 Planning Budget 40,000 Machine-hours Direct labor wagen Supplies Maintenance Untis Supervision Depreciation Total $ 75,300 22,800 22,800 20,500 44,000 73,000 $ 258,400 $ 73.600 21,200 20.500 19.300 44,000 73.000 $ 251,600

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Connect For Financial Accounting Fundamentals

Authors: Author

8th Edition

126411169X, 9781264111695

More Books

Students also viewed these Accounting questions