Problem 22-3A (Part Level Submission) Ratchet Company uses budgets in controlling costs. The August 2017 budget report for the company's Assembling Department is as follow RATCHET COMPANY Budget Report Assembling Department For the Month Ended August 31, 2017 Difference Favorable Unfavorable Neither Favorable Manufacturing Costs Budget Actual her Unfavorable Variable costs Direct materials $50,740 549,740 $1,000 Favorable Direct labor 54,280 51,480 2,800 Favorable Indirect materials 25,950 26,260 300 Unfavorable Indirect labor 22.420 21,940 480 Favorable Utilities 14,750 14,580 170 Favorable 5.900 6,120 220 Unfavorable Total variable 124050 170 120 3.930 Favorable Supervision Depreciation Totale 10,000 10,000 -- Nether favorable nor Unfavorable 18.200 18,200 0-Neither favorable ner Unfavorable 5,200 5 ,200 -- Neither Favorable nor Unfavorabile 33,400 33.4000 - Neither favorable For Unfavorable $207,450 1203,530 $3,930 Favorable The month budget amounts in the report were based on an expected production of 50.000 units per month or 700,000 units per year. The Assembling Department managers pleased with the report and expects are cat praise for a job well done. The company president, however, Ishape with the results for August because only 57,000 Rs were produced Your answer is correct. (a) State the total monthly budgeted cost formula, (Round cost per unit to 2 decimal places, e.g. 1.25.) The formula is - 33,400 12.95 + variable costs of 2.95 per unit. (6) Prepare a budget report for August using flexible budget data. (List variable costs before fixed costs.) RATCHET COMPANY Assembling Department Flexible Budget Report For the Month Ended August 31, 2017 Difference Favorable Unfavorable Neither Favorable nor Unfavorable Actual Costs Units 57000 57000 Variable Costs Direct Materials O T 720 | Unfavorable TL 2 1 1 S 11" D O 49020 49740 52440) 51400 250801 26200 21660 21940 14250 14580 1 168150 170129 960 Favor 1100 280 3300 4 20 Unfavorable 1970 (unfav D I JUU Maintenance Total Variable Costs Fixed Costs Rent 10000 10000 o Neither Favorable nor Unfavorable Favorable Unfavorable Neither Favorable nor Unfavorable Budget Actual Costs Units T 570001T 57000 Variable Costs Direct Materials co Direct Labor D T 52440 T Indirect Materials 1 29740 51480 26260 21940 14580 1 6129] 170120) Indirect Labor T 720Unfavorable 960 | Favorable 1180 ( Unfavorable 280 unfavorable 330 420 unfavorabi 1970 Utilities 1 14250 5700 168150 Maintenance 0 Total Variable Costs 1 1 SSR 15 5 Fixed Costs Rent Supervision Di 10000 10000 1 Neither Favorable nor Unfavorable 182001 182001 ol Neither Favorable nor Unfavorable Depreciation D T T L oll Neither Favorable nor Unfavorable 5200 33400 s 3340 oll Neither Favorable nor Unfavorable Total Costs 201550 I 20352 1970 | Unfavorable Click if you would like to Show Work for this question: Open Show Work NE CALCULATOR PRINTER VERSION BACK (C) September, 63,000 units were produced. Prepare the budget report using flexible budget data, assuming (1) each variable cost was 10% higher than its actual cost in August, and (2) fed costs were the same in September as in August (List variable costs before fixed costs.) RATCHET COMPANY Assembling Department Flexible Budget Report For the Month Ended September 30, 2017 Difference Actual Costs