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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.

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 $1.10
Indirect materials 0.70
Utilities 0.40

Fixed overhead costs per month are Supervision $4,100, Depreciation $2,000, and Property Taxes $500. The company believes it will normally operate in a range of 7,10012,800 direct labor hours per month. Assume that in July 2020, Myers Company incurs the following manufacturing overhead costs.

Variable Costs

Fixed Costs

Indirect labor $11,710 Supervision $4,100
Indirect materials 7,460 Depreciation 2,000
Utilities 3,860 Property taxes 500

(a) Prepare a flexible budget performance report, assuming that the company worked 10,900 direct labor hours during the month.

(b) Prepare a flexible budget performance report, assuming that the company worked 10,300 direct labor hours during the month.

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