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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
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 | $ | 16.50 | q | |||
Indirect labor | $ | 4,600 | + | $ | 2.10 | q |
Utilities | $ | 5,500 | + | $ | 0.80 | q |
Supplies | $ | 1,700 | + | $ | 0.10 | q |
Equipment depreciation | $ | 18,600 | + | $ | 2.70 | q |
Factory rent | $ | 8,200 | ||||
Property taxes | $ | 2,900 | ||||
Factory administration | $ | 13,000 | + | $ | 0.70 | q |
The actual costs incurred in March in the Production Department are listed below: |
Actual Cost Incurred in March | ||||||||||||||||||||||||||||||||
Direct labor | $ | 69,270 | ||||||||||||||||||||||||||||||
Indirect labor | $ | 12,810 | ||||||||||||||||||||||||||||||
Utilities | $ | 9,330 | ||||||||||||||||||||||||||||||
Supplies | $ | 2,340 | ||||||||||||||||||||||||||||||
Equipment depreciation | $ | 29,670 | ||||||||||||||||||||||||||||||
Factory rent | $ | 8,600 | ||||||||||||||||||||||||||||||
Property taxes | $ | 2,900 | ||||||||||||||||||||||||||||||
Factory administration | $ | 15,240 | ||||||||||||||||||||||||||||||
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