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 laborhours worked in a month:

Direct labor $16.50q

Indirect labor $ 4,100 + $ 1.90q

Utilities $ 5,400 + $ 0.30q

Supplies $ 1,300 + $ 0.30q

Equipment depreciation $18,400 + $ 2.50q Factory rent $8,500

Property taxes $2,700

Factory administration $13,200 + $ 0.50q

The actual costs incurred in March in the Production Department are listed below: Actual Cost

Incurred in

	March
Direct labor	$ 65,970
Indirect labor	$ 11,070
Utilities	$ 7,020
Supplies	$ 2,740
Equipment depreciation	$ 28,150
Factory rent	$ 8,900
Property taxes	$ 2,700
Factory administration	$ 14,480

Required:

The company had budgeted for an activity level of 4,100 laborhours in March. Complete the Production Departments planning budget for the month.

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

The company actually worked 3,900 laborhours in March. Complete the Production Departments 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

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
Production Department Flexible Budget Performance Report
For the Month Ended March 31
	Spending Variances
Direct labor
Indirect labor
Utilities
Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
Total expense