Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor Indirect materials Utilities $1.00 0.60 0.40 Fixed overhead costs per month are Supervision $4,000, Depreciation $1,200, and Property Taxes $800. The company believes it will normally operate in a range of 7,000-10,000 direct labor hours per month. Assume that in July 2017, Myers Company incurs the following manufacturing overhead costs. Variable Costs Fixed Costs Indirect labor $8,800 Supervision $4,000 Indirect materials 5,300 Depreciation 1,200 Utilities 3,200 Property taxes 800 $9,000 MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2017 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours (DLH) 9,000 DLH 9,000 DLH Variable costs Indirect labor $8,800 $200 F Indirect materials 6,300 5,800 500 F Utilities 3,600 3,200 400 F Total variable costs 18,900 17,800 1,100 F Fixed costs Supervision 4,000 4,000 Depreciation 1,200 1,200 Property taxes 800 Total fixed costs 6,000 6,000 Total costs $24,900 $23,800 $1,100F 800 Activat Go to Set MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2017 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours (DLH) 8,500 DLH 8,500 DLH Variable costs Indirect labor ($1.00) $8,500 $8,800 $300 U Indirect materials ($0.70) 5,950 5,800 150 F Utilities ($0.40) 3,400 3,200 200 F Total variable costs ($2.10) 17,850 17,800 50 F Fixed costs Supervision 4,000 4,000 Depreciation 1,200 1,200 Property taxes 800 800 Total fixed costs 6,000 6,000 Total costs $23,850 $23,800 $50 F (c) Comment on the findings of manufacturing overhead flexible budget report using the two different direct labor hours 9,000 and 8,500