Not Graded (Please explain in A.B.C etc Format) Please give realistic, answers so I can understand. Thank You! Porter Corporation has just hired Bill Harlow as its new controller. Although Harlow has had little formal accounting training, he professes to be highly experienced having learned accounting "the hard way" in the field. At the end of his first months work, Harlow prepared the following performance report:

Porter Corporation Peformance report For the moth June, 2018

	Total Actual Cost	Total Budgeted Costs	Variances
Direct Materials	216,630	237,600	20,970 (F)
Direct Labor	119,340	132,000	12,660 (F)
Variable Overhead	63,000	66,000	3,000(F)
Fixed Overhead	184,00	184,00
	582,970	619,000	36,630 (F)

In the presentation at Porters month end management meeting, Harlow indicated that things were going "fantastically." the figure indicate, he said, "that the firm is beating its budget in all cost categories. " This good news made everyone at the meeting happy and furthered Harlow's acceptance as member of the management team. After the management meeting, Susan Jones, Porters General mamager asked you as an independent consultant to review Harlows report. Jone's concern stemmed from the fact that Porter has never operated favorably as Harlows report seems to imply and she cannot explain the apparent significant improvement.

While reviewing Harlows report you are provided the following cost and operating data for June: Porter has a monthly normal capacity of 11,000 direct labor hours, or 8,800 units of product. Standard costs per unit for its only product are direct materials 3 pounds at 9 dollars per pound ; direct labor 1.25 hours at 12 dollars an hour and variable overhead rate per direct labor hour of 6 dollars per hour. During June Porter poduced 8,000 units of product using 24,900 pounds of materials costing 8.70 each, 10,200 direct labor hours at an average of 11.70 each, and incurred variable overhead costs of 63,000 and fixed overhead costs of 184,000.

After reviewing Porters Junes cost data you tell harlow that his cost report contains a classic budgeting error, and you explain how he can remedy it. In reposne to your suggestion, Harlow revises his report as follows:

	Total Actual Cost	Total Budgeted Cost	Variances
Direct Materials	216,630	216,000	630 U
Direct Labor	119,340	120,000	660F
Variable Overhead	63,000	60,000	3000 U
Fixed Overhead	184000	184,000
	582,970	580,000	2,970 U

Harlows revised report is accompanied by remarks expressing regret at the oversight in the original report. Answer the following in (A, B, C etc Format) (As the consultant) A. Verify Harlow's actual cost figures correct.

B. Identify and explain the classic budgeting error that Harlow apparently incorporated into his original cost report.

C. Explain Why Harlow's revised figures could be considered deficient. D. Further analyze Harlows revised variances, isolating underlying potential casual factors. how do your analyses indicate bases for concern to management?