__PRESENT

Refer to DCdesserts.com's activity-based flexible budget in Exhibit 11-11 Suppose that the company's activity in June is described as follows: Process hours Production runs New products tested Direct material handled (pounds) 7,500 16 30 40,000 Required: 1. Determine the flexible budgeted cost for each item in the table below. 2-a. Compute the variance for setup cost during the month, assuming that the actual setup cost was $3,000. Use the activity-based flexible budget. 2-b. Compute the variance for setup cost during the month, assuming that the actual setup cost was $3,000. Use DCdesserts.com's conventional flexible budget (Exhibit 11-3). Complete this question by entering your answers in the tabs below. Reg 1 Req 2A Req 2B Compute the variance for setup cost during the month, assuming that the actual setup cost was $3,000. Use DCdesserts.com's conventional flexible budget. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance).) Variance 19 Req 2A Req 2B Monthly Flexible Overhead Budget Budgeted Cost Level of Activity Cost Pool I (cost driver: process hours) 6,000 7,500 9,000 Indirect material: Nonstick cooking spray $12.000 $15.000 $18.000 Waxed paper 2.000 2.500 3.000 Other paper products 2.000 2.500 3.000 Miscellaneous supplies 6,000 7,500 9,000 Indirect labor: maintenance 4.000 5.000 6,000 Utilities: Electricity 3,000 3,750 4,500 Natural gas 1.000 1.250 1,500 Total of cost pool I $30,000 $37,500 $45.000 Cost Pool II (cost driver: production runs) 8 12 16 Indirect labor: Inspection $ 2.200 $ 3.300 $ 4,400 Setup 3.000 4.500 6,000 Total of cost pool II $ 5,200 $ 7.800 $10,400 Cost Pool III (cost driver: new products tested) 20 30 40 Test kitchen $ 1.200 $ 1.800 $ 2.400 Total of cost pool III $ 1.200 $ 1.800 $ 2.400 Cost Pool IV (cost driver: pounds of material handled) 20,000 30,000 40,000 Material handling $ 2.000 $ 3.000 $ 4,000 Total of cost pool IV $ 2.000 $ 3,000 $ 4.000 Cost Pool V (facility level costs) Indirect labor: production supervisors $ 6,000 $ 6.000 $ 6,000 Depreciation: plant and equipment 500 500 500 Insurance and property taxes 100 100 100 Total of cost pool V $ 6,600 $ 6,600 $ 6,600 Total overhead cost $45,000 $56,700 $68,400 Monthly Flexible Overhead Budget Cost Process Hours 7,500 Budgeted Overhead Costs per Hour 6,000 9,000 $ Variable overhead costs: Indirect material: Nonstick cooking spray Waxed paper Other paper products Miscellaneous supplies Indirect labor. maintenance Utilities Electricity Natural gas Total variable overhead cost 2.00 $ 12,000 $ 0.33 2.000 0.33 2,000 1.00 6,000 0.67 4,000 15,000 $18,000 2,500 3,000 2,500 3,000 7,500 9,000 5,000 6,000 0.50 0.17 3,000 1,000 30,000 $ 3,750 4,500 1,250 1,500 37,500 $ 45,000 $ $ Fixed overhead costs: Indirect labor Inspection Production supervisors Setup specialists Material handling Depreciation: plant and equipment Insurance and property taxes Test kitchen Total fixed overhead cost Total overhead cost 2,200 $ 6,000 3,000 2,000 500 100 1,200 15,000 $ 45,000 $ 2,200 $ 2.200 6,000 6,000 3,000 3,000 2,000 2,000 500 500 100 100 1,200 1,200 15,000 $15,000 52,500 $60,000 AIA $ $