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, whereqis the number of labor-hours worked in a month:

Cost FormulasDirect labor$16.10qIndirect labor$4,500 + $1.50qUtilities$5,200 + $0.50qSupplies$1,200 + $0.30qEquipment depreciation$18,600 + $3.10qFactory rent$8,300Property taxes$3,000Factory administration$13,500 + $0.80q

The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below:

Actual Cost Incurred in MarchDirect labor$65,940Indirect labor$9,980Utilities$7,690Supplies$2,670Equipment depreciation$31,000Factory rent$8,700Property taxes$3,000Factory administration$16,090

Required:

1. Prepare the Production Department's planning budget for the month.

2. Prepare the Production Department's flexible budget for the month.

3. Prepare the Production Department's flexible budget performance report for March, including both the spending and activity variances.