Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.30q Indirect labor $4,100 + $1.60q Utilities $5,200 + $0.90q Supplies $1,500 + $0.20q Equipment depreciation $18,200 + $3.00q Factory rent $8,300 Property taxes $2,500 Factory administration $13,500 + $0.90q The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 70,040 Indirect labor $ 10,320 Utilities $ 9,550 Supplies $ 2,590 Equipment depreciation $ 30,800 Factory rent $ 8,700 Property taxes $ 2,500 Factory administration $ 16,690 Required: 1. Prepare the Production Departments planning budget for the month. 2. Prepare the Production Departments flexible budget for the month. 3. Calculate the spending variances for all expense items.

\begin{tabular}{|l|r|r|r|} \hline \multicolumn{3}{|c|}{ Packaging Solutions Corporation } \\ \hline & \multicolumn{3}{|c|}{ Spending Variances } \\ \hline & For the Month Ended March 31 \\ \hline Labor-hours & Actual Results & Spending Variances & Budget \\ \hline Direct labor & 4,200 & \\ \hline Indirect labor & 70,040 \\ \hline Utilities & 10,320 & \\ \hline Supplies & 9,550 & \\ \hline Equipment depreciation & 2,590 & \\ \hline Factory rent & 30,800 & \\ \hline Property taxes & 8,700 \\ \hline Factory administration & 2,500 \\ \hline Total expense & 16,690 \\ \hline \end{tabular} Prepare the Production Department's flexible \begin{tabular}{|l|l|} \hline \multicolumn{1}{|c|}{ Packaging Solutions Corporation } \\ \hline \multicolumn{1}{|c|}{ Production Department Flexible Budget } \\ \hline For the Month Ended March 31 \\ \hline Direct labor & \\ \hline Indirect labor & \\ \hline Utilities & \\ \hline Supplies & \\ \hline Equipment depreciation & \\ \hline Factory rent & \\ \hline Property taxes & \\ \hline Factory administration & \\ \hline Total expense & \\ \hline \end{tabular}