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

Frank Weston, supervisor of the Freemont Corporations Machining Department, was visibly upset after being reprimanded for his departments poor performance over the prior month. The departments cost control report is given below:

Freemont CorporationMachining Department Cost Control Report For the Month Ended June 30
Actual Results Planning Budget Variances
Machine-hours 38,000 35,000
Direct labor wages $ 86,100 $ 80,500 $ 5,600 U
Supplies 23,100 21,000 2,100 U
Maintenance 137,300 134,000 3,300 U
Utilities 15,700 15,200 500 U
Supervision 38,000 38,000 0
Depreciation 80,000 80,000 0
Total $ 380,200 $ 368,700 $ 11,500 U

I just cant understand all 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 $92,000; the fixed component of the budgeted utilities cost is $11,700.

NEED ANSWERS AS FOLLOWS:

Required:
2.

Complete the performance report that will help Mr. Westons superiors assess how well costs were controlled in the machining department. (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 CorporationMachining Department
Flexible Budget Performance Report
For the Month Ended June 30
Actual Results Spending Variances Flexible Budget Activity Variances Planning Budget
Direct labor wages $86,100 U $80,500
Supplies 23,100 U 21,000
Maintenance 137,300 134,000
Utilities 15700 15,200
Supervision 38,000 38,000
Depreciation 80,000 80,000
Total $380,200 $0 $368,700

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