Ratchet Company uses budgets in controlling costs. The August 2020 budget report for the company's Assembling Department is as follows.. RATCHET COMPANY Budget Report Assembling Department For the Month Ended August 31, 2020 Difference Manufacturing Costs Budget Actual Favorable Unfavorable Neither Favorable nor Unfavorable Variable costs Direct materials $51,240 $50,240 $1,000 Favorable Direct labor 59,780 Indirect materials 56,680 3,100 Favorable 25,620 25,920 300 Unfavorable Indirect labor 19.520 19,090 430 Favorable Utilities 15.250 15,080 170 Favorable Maintenance 12.200 12.400 200 Unfavorable Total variable 183,610 179,410 4,200 Favorable Fixed costs