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 $16.20q Indirect labor $4,600 + $1.30q Utilities $5,200 + $0.70q Supplies $1,600 + $0.30q Equipment depreciation $18,300 + $2.60q Factory rent $8,100 Property taxes $2,400 Factory administration $13,000 + $0.50q The Production Department planned to work 4,500 labor-hours in March; however, it actually worked 4,300 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 71,220 Indirect labor $ 9,630 Utilities $ 8,740 Supplies $ 3,160 Equipment depreciation $ 29,480 Factory rent $ 8,500 Property taxes $ 2,400 Factory administration $ 14,480 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.

Cost Formulas
Direct labor	$16.20q
Indirect labor	$4,600 + $1.30q
Utilities	$5,200 + $0.70q
Supplies	$1,600 + $0.30q
Equipment depreciation	$18,300 + $2.60q
Factory rent	$8,100
Property taxes	$2,400
Factory administration	$13,000 + $0.50q

The Production Department planned to work 4,500 labor-hours in March; however, it actually worked 4,300 labor-hours during the month. Its actual costs incurred in March are listed below:

	Actual Cost Incurred in March
Direct labor	$	71,220
Indirect labor	$	9,630
Utilities	$	8,740
Supplies	$	3,160
Equipment depreciation	$	29,480
Factory rent	$	8,500
Property taxes	$	2,400
Factory administration	$	14,480

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 budget for the month. Packaging Solutions Corporation Production Department Planning Budget For the Month Ended March 31 Budgeted labor-hours Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expense 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 Required 1 Required 2 Required 3 Calculate the spending variances for all expense items. (Indicate the effect of ea for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts Packaging Solutions Corporation Spending Variances For the Month Ended March 31 Actual Spending Variances Results 4,300 Flexible Budget Labor-hours Direct labor 71,220 9,630 8,740 3,160 29,480 Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expense 8,500 2,400 14,480 147,610 $