QUESTION 16 Forrest Gump Company is excited about its newly implemented budgeting program. In the month of May 2020, the Budget Officer presented the following budget report FORREST GLUMP COMPANY BUDGET REPORT (Expected 72,000 units) FOR THE MONTH ENDED MAY 31, 2020 Difference Favorable F Production Costs Budget Actual Unfavorable U Variable Costs: Direct Materials $ 57,600 $ 56,400 $ 1,200 F Direct labor 64,800 61.440 3,360 F Indirect materials 28,800 29,040 240 U Indirect labor 21,600 21,000 600 F Utilities 18,000 17.880 120 F Maintenance 7.200 7.440 240 U Total Variable 198,000 193,200 4.800 F Fixed costs Rent 14,400 14,400 -0. Depreciation 7,200 7,200 -0- Supervision 20.400 20.400 -0. Total fixed 42.000 42.000 Total costs $240.000 $ 235,200 4.800 F The May budget reported above is based on expected manufacturing of 72,000 units (564,000 units annually on a monthly basis for 12 months). The actual units produced was 70,500 units. The budget officer and the CEO are fairly happy about the report shown above. You are a summer intern and have been asked to comment on the report You indicate the the budget report is not providing accurate, meaningful information. He apree to prepare a flexible buget for May REQUIRED 1. What is your comments about the report as presented by the Budget Officer? Be specific 2. Prepare an appropriate flexible report for the month of May