Hi, would you help me to solve this problem?

Thanks Tanya

Braemar Saddlery uses department budgets and performance reports in planning and controlling its manufacturing operations. The following annual performance report for the custom saddle production department was presented to the president of the company.

	Budgeted Costs for 5,000 Units								Actual Costs Incurred				Over (Under) Budget
	Per Unit				Total
Variable manufacturing costs:
Direct materials	$	30.00			$	150,000			$	171,000			$	21,000
Direct labor		48.00				240,000				261,500				21,500
Indirect labor		15.00				75,000				95,500				20,500
Indirect materials, supplies, etc.		9.00				45,000				48,400				3,400
Total variable manufacturing costs	$	102.00			$	510,000			$	576,400			$	66,400
Fixed manufacturing costs:
Lease rental	$	9.00			$	45,000			$	45,000			$	0
Salaries of foremen		24.00				120,000				125,000				5,000
Depreciation and other		15.00				75,000				78,600				3,600
Total fixed manufacturing costs	$	48.00			$	240,000			$	248,600			$	8,600
Total manufacturing costs	$	150.00			$	750,000			$	825,000			$	75,000

Although a production volume of 5,000 saddles was originally budgeted for the year, the actual volume of production achieved for the year was 6,000 saddles. Direct materials and direct labor are charged to production at actual cost. Factory overhead is applied to production at the predetermined rate of 150 percent of the actual direct labor cost.

After a quick glance at the performance report showing an unfavorable manufacturing cost variance of $75,000, the president said to the accountant: Fix this thing so it makes sense. It looks as though our production people really blew the budget. Remember that we exceeded our budgeted production schedule by a significant margin. I want this performance report to show a better picture of our ability to control costs.

Required: a. Prepare a revised performance report for the year on a flexible budget basis. Use the same format as the production report above, but revise the budgeted cost figures to reflect the actual production level of 6,000 saddles.

c. What is the amount of over- or underapplied manufacturing overhead for the year?