Limo Company uses budgets in controlling costs. The March 2020 budget report for the companys Assembling Department is as follows:

Limo Company

Budget Report

Assembling Department

For the Month Ended March 31 2020

Manufacturing Overhead	Budget	Actual
Variable costs
Indirect materials	$48,000	46,000
Indirect labour	65,000	51,200
Utilities	15,000	15,600
Maintenace	12,000	12,500
Fixed Costs
Rent	15,000	14,200
Supervision	18,000	19,300
Depreciation	5,000	5,200

The monthly budget amounts in the report were based on an expected production of 65,000 units per month or 780,000 units per year.

Given the actual expenses, the Assembling Department manager is pleased with the report and expects some praise for a job well done.

The company president, however, is unhappy with the results for March because only 55,000 units were produced .

Required:

1. State the total monthly budgeted cost formula.
2. Prepare a Budget Report for March using flexible budget data.
3. Which budget report provides a better basis for evaluating performance? Explain