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:

Direct labor				$	16.30	q
Indirect labor	$	4,600	+	$	1.60	q
Utilities	$	5,300	+	$	0.80	q
Supplies	$	1,700	+	$	0.30	q
Equipment depreciation	$	18,000	+	$	3.00	q
Factory rent				$	8,100
Property taxes				$	2,700
Factory administration	$	13,200	+	$	0.70	q

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

Actual Cost Incurred in March

Direct labor

$

70,040

Indirect labor

$

10,820

Utilities

$

9,210

Supplies

$

3,230

Equipment depreciation

$

30,600

Factory rent

$

8,500

Property taxes

$

2,700

Factory administration

$

15,510

Required:
	1)The company had budgeted for an activity level of 4,400 labor-hours in March. Complete the Production Departments planning budget for the month. 2)The company actually worked 4,200 labor-hours in March. Complete the Production Departments flexible budget for the month.

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 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