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	$16.40q
Indirect labor	$4,300 + $2.00q
Utilities	$5,800 + $0.80q
Supplies	$1,700 + $0.40q
Equipment depreciation	$18,600 + $3.00q
Factory rent	$8,400
Property taxes	$2,800
Factory administration	$13,600 + $0.60q

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 March
Direct labor	$	67,200
Indirect labor	$	11,880
Utilities	$	9,550
Supplies	$	3,590
Equipment depreciation	$	30,600
Factory rent	$	8,800
Property taxes	$	2,800
Factory administration	$	15,350

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.

Required 1 Required 2 Required 3 Prepare the Production Department's planning Packaging Solutions Corporation Production Department Planning Budget For the Month Ended March 31 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expense $ 01 Required 1 Required 2 Required 3 Prepare the Production Department's flexible budget for the month. Packaging Solutions Corporation Production Department Flexible Budget For the Month Ended March 31 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expense 0 Required 1 Required 2 Required 3 Calculate the spending variances for all expense items. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Packaging Solutions Corporation Spending Variances For the Month Ended March 31 Actual Results Spending Variances Flexible Budget Labor-hours 4,000 Direct labor $ 67,200 Indirect labor 11,880 Utilities 9,550 3,590 30,600 Supplies Equipment depreciation Factory rent Property taxes Factory administration 8,800 2,800 15,350 Total expense $ 149,770