Hello,

I need help with part c of this attachment, thanks.

CHAPTER 24 QUESTION 4 PART C Ratchet Company uses budgets in controlling costs. The August 2017 budget report for the company's Assembling Department is as follows. RATCHET COMPANY Budget Report Assembling Department For the Month Ended August 31, 2017 Difference Manufacturing Costs Budget Actual Favorable Unfavorable Neither Favorable nor Unfavorable Variable costs Direct materials $54,180 $53,080 $1,100 Favorable Direct labor 60,480 57,080 3,400 Favorable Indirect materials 30,240 30,440 200 Unfavorable Indirect labor 21,420 21,020 400 Favorable Utilities 18,900 18,800 100 Favorable Maintenance 10,080 10,440 195,300 190,860 Rent 11,100 11,100 -0- Neither Favorable nor Unfavorable Supervision 16,000 16,000 -0- Neither Favorable nor Unfavorable 6,800 6,800 -0- Neither Favorable nor Unfavorable 33,900 33,900 $229,200 $224,760 Total variable 360 Unfavorable 4,440 Favorable Fixed costs Depreciation Total fixed Total costs -0- Neither Favorable nor Unfavorable $4,440 Favorable The monthly budget amounts in the report were based on an expected production of 63,000 units per month or 756,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 61,000 units were produced. (a) & (b) Your answer is partially correct. Try again. (a) State the total monthly budgeted cost formula. (Round cost per unit to 2 decimal places, e.g. 1.25.) $ 229,200 The formula is = + variable costs of $ 3.63 per unit. (b) Prepare a budget report for August using flexible budget data. (List variable costs before fixed costs.) RATCHET COMPANY Assembling Department Flexible Budget Report For the Month Ended August 31, 2017 Difference Budget Actual Costs Favorable Unfavorable Neither Favorable nor Unfavorable Units 61000 61000 Variable Costs $ $ $ Direct Materials 52460 53,080 620 Unfavorable Direct Labor 58560 57080 -1480 Favorable Indirect Materials 29280 30440 1160 Unfavorable Indirect Labor 20740 21,020 280 Unfavorable Utilities 18300 18800 500 Unfavorable Maintenance 9760 10440 680 Unfavorable Total Variable Costs 189,100 190860 1760 Unfavorable Rent 11,100 11,100 0 Neither Favorable nor Unfavorable Supervision 16000 16000 0 Neither Favorable nor Unfavorable Depreciation 6800 6800 0 Neither Favorable nor Unfavorable Total Fixed Costs 33900 33900 Fixed Costs $ Total Costs SHOW SOLUTION SHOW ANSWER 223,000 Neither Favorable nor Unfavorable $ 224,760 $ 1760 Unfavorable LINK TO TEXT LINK TO Attempts: 3 of 3 used TEXT (c) In September, 67,000 units were produced. Prepare the budget report using flexible budget data, assuming (1) each variable cost was 10 % higher than its actual cost in August, and (2) fixed costs were the same in September as in August. (List variable costs before fixed costs.) RATCHET COMPANY Assembling Department Flexible Budget Report For the Month Ended September 30, 2017 Difference Favorable Unfavorable Neither Favorable nor Unfavorable Actual Costs Budget $ $ $ $ $ $