Machining Department Monthly Production Budget Wages Utilities Depreciation Total $862,000 66,000 109,000 $1,037,000 The actual amount spent and the actual units produced in the first three months in the Machining Department were as follows: Amount Spent Units Produced January February $979,000 93,000 930,000 84,000 March 893,000 76,000 The Machining Department supervisor has been very pleased with this performance because actual expenditures for January-March have been less than the monthly static budget of $1,037,000. However, the plant manager believes that the budget should not remain fixed for every month but should "flex" or adjust to the volume of work that is produced in the Machining Department. Additional budget information for the Machining Department is as follows: Wages per hour $17.00 Utility cost per direct labor hour $1.30 Direct labor hours per unit 0.50 Planned monthly unit production 101,000