need help with part C
Question 4 Marigold Company uses budgets in controlling costs. The August 2017 budget report for the company's Assembling Department is as follows. MARIGOLD COMPANY Budget Report Assembling Department For the Month Ended August 31, 2017 Difference Favorable Manufacturing Costs Budget Actual Unfavorable Variable costs Direct materials $51,600 $50,600 $1,000 Favorable Direct labor 56,400 53,600 2,800 Favorable Indirect materials 28,800 29,000 200 Unfavorable Indirect labor 22,800 22,380 420 Favorable Utilities 15,000 14,860 140 Favorable Maintenance 8,400 8,740 340 Unfavorable Total variable 183,000 179,180 3,820 Favorable Fixed costs Rent 12,200 12,200 -0- Supervision 16,900 16,900 -0- Depreciation 7,700 7,700 -0- Total fixed 36,800 36,800 -0- Total costs $219,800 $215,980 $3,820 Favorable The monthly budget amounts in the report were based on an expected production of 60,000 units per month or 720,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 58,000 units were produced. (a) Your answer is correct. State the total monthly budgeted cost formula. (Round cost per unit to 2 decimal places, e.g. 1.25.) The formula is $ 36800 + variable costs of $ 3.05 per unit.(b1) Your answer is correct. Prepare a budget report for August using flexible budget data. (List variable costs before fixed costs.) MARIGOLD COMPANY Assembling Department Flexible Budget Report For the Month Ended August 31, 2017 Difference Favorable Unfavorable Neither Favorable Budget Actual Costs nor Unfavorable V v Units 58000 58000 Variable Costs Direct Materials 49880 50600 -K 720 Unfavorable V Direct Labor 54520 53600 920 Favorable V V Indirect Materials 27840 29000 1160 Unfavorable V Indirect Labor 22040 22380 340 Unfavorable v Utilities 14500 14860 360 Unfavorable Maintenance 3120 8740 520 Unfavorable Total Variable Costs 176900 179180 2280 Unfavorable Fixed Costs v V Rent 12200 12200 Neither Favorable nor Unfavorable + Supervision 16900 16900 0 Neither Favorable nor Unfavorable + Depreciation 7700 7700 0 Neither Favorable nor Unfavorable Total Fixed Costs 36800 36800 0 Neither Favorable nor Unfavorable + Total Costs 213700 $ 215980 2280 Unfavorable(c) Your answer is partially correct. Try again. In September, 64,000 units were produced. Prepare the budget report using flexible budget data, assuming (1) each variable cost was 10% higher than its actual cost in August, and (2) fixed costs were the same in September as in August. (List variable costs before fixed costs.) MARIGOLD COMPANY Assembling Department Flexible Budget Report For the Month Ended September 30, 2017 Difference Favorable Unfavorable Budget Actual Costs Neither Favorable nor Unfavorable X Units 65000 6500 Variable Costs x Direct Materials 55900 65600 X x 240 Favorable X V X Direct Labor 61100 58960 2140 Unfavorable Indirect Materials 31200 31900 700 Unfavorable X XE Indirect Labor 24700 24618 32 Favorable Utilities 16250 16346 96 Unfavorable x V X V Maintenance 910 9614 514 Unfavorable V x Total Variable Costs + x 198250 197098 1152 Favorable Fixed Costs V Rent 1220 1220 O Neither Favorable nor Unfavorable + V Supervision 16900 16900 Neither Favorable nor Unfavorable V Depreciation 7700 7700 o Neither Favorable nor Unfavorable + Total Fixed Costs 36800 36800 0 Neither Favorable nor Unfavorable + X x Total Costs 235050 233898 $ 1152 Favorable
