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 + $1.90q

Utilities $5,300 + $0.40q

Supplies $1,500 + $0.40q

Equipment depreciation $18,400 + $2.50q

Factory rent $8,600

Property taxes $2,700

Factory administration $13,400 + $0.90q

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 $ 66,360

Indirect labor $ 11,760

Utilities $ 7,370

Supplies $ 3,390

Equipment depreciation $ 28,400

Factory rent $ 9,000

Property taxes $ 2,700

Factory administration $ 16,410 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.