RATCHET COMPANY Budget Report Assembling Department For the Month Ended August 31, 2020 Difference Favorable Unfavorable Neither Favorable Manufacturing Costs Budget Actual nor Unfavorable Variable costs Direct materials $53,760 $52,760 $1,000 Favorable Direct labor 62,720 59,620 3,100 Favorable Indirect materials 25,600 25,800 200 Unfavorable Indirect labor 20,480 20,020 460 Favorable Utilities 22,400 22,280 120 Favorable Maintenance 12,800 13,180 380 Unfavorable Total variable 197,760 193,660 4,100 Favorable Fixed costs Rent 10,800 10,800 -O- Neither Favorable nor Unfavorable Supervision 17,600 17,600 -O- Neither Favorable nor Unfavorable Depreciation 5,700 5,700 -- Neither Favorable nor Unfavorable Total fixed 34,100 34,100 -O- Neither Favorable nor Unfavorable Total costs $231,860 $227,760 $4,100 Favorable The monthly budget amounts in the report were based on an expected production of 64,000 units per month or 768,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 62,000 units were produced. (a) State the total monthly budgeted cost formula. (Round cost per unit to 2 decimal places, e.g. 1.25.) The formula is $ variable costs of $ per unit. (b) 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, 2020 Difference Favorable Unfavorable Neither Favorable nor Unfavorable Budget Actual Costs $ $ $ LA n LA G > In September, 68,000 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) fixed 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, 2020 Difference Favorable Unfavorable Neither Favorable Budget Actual Costs nor Unfavorable $ $ > > > $ $ Click if you would like to Show Work for this question: Open Show Work