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Prepare a flexible budget for the actual units produced for January, February, and March in the Machining Department. Assume depreciation is a fixed cost. Enter
Prepare a flexible budget for the actual units produced for January, February, and March in the Machining Department. Assume depreciation is a fixed cost. Enter all amounts as positive numbers. If required, use per unit amounts carried out to two decimal places.
Nell Company-Machining Department | |||
Flexible Production Budget | |||
For the Three Months Ending March 31, 2016 | |||
January | February | March | |
Units of production | |||
Wages | $ | $ | $ |
Utilities | |||
Depreciation | |||
Total | $ | $ | $ |
b. Compare the flexible budget with the actual expenditures for the first three months.
January | February | March | |
Total flexible budget | $ | $ | $ |
Actual cost | |||
Excess of actual cost over budget | $ | $ | $ |
What does this comparison suggest?
The Machining Department has performed better than originally thought. | |
The department is spending more than would be expected. |
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