Novak Company uses a flexible budget for manufacturing overhead based on direct labor hours. Budgeted variable manufacturing overhead costs per direct labor hour are as follows.

Indirect labor		$ 1.00
Indirect materials		0.70
Utilities		0.40

Budgeted 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 2022, Novak Company incurs the following manufacturing overhead costs.

Variable Costs				Fixed Costs
Indirect labor		$ 8,976		Supervision		$ 4,000
Indirect materials		5,916		Depreciation		1,200
Utilities		3,264		Property taxes		800

(a) Prepare a flexible budget performance report, assuming that the company worked 9,000 direct labor hours during the month. (List variable costs before fixed costs.)

(b) Prepare a flexible budget performance report, assuming that the company worked 8,670 direct labor hours during the month. (List variable costs before fixed costs.)

Budget Actual Costs nor Unfavc Direct Labor Hours v 9000 9000 Variable Costs Indirect Labor $ 8,976 $ 9,000 $ Indirect Materials 5,916 $9,000 Utilities 3,264 $6,300 Total Variable Costs $3,600 Fixed Costs Supervision 4,000 4,000 4,000 Depreciation 1,200 1.200 1,200 Property Taxes 800 800 800 Total Fixed Costs 6,000 6,000 6,000 Total Costs $ $ $ Unfavorable Neither Favorable nor Unfavorable Budget Actual Costs $ $ $ ta $ $ Property Taxes Total Costs Indirect Materials Direct Labor Hours Variable Costs Indirect Labor Total Fixed Costs Utilities Total Variable Costs Depreciation Fixed Costs Supervision