Ron Kanobi, Director Of Operations, was upset because their group was not receiving their bonus due to the performance report provided below by the Senior Management Team.

They explained to a colleague, "I know that my department has worked more efficiently than it has ever worked before and completed more units. I thought it might be over the supplies that have increased due to work at home needs but that is only a small amount of the overall budget. Everything is unfavourable, and I dont even know why.

The Operations Department had a budgeted activity level of 30,000 units. Actual production for the month was 34,000 units.

REQUIRED

In the provided Template:

1. Prepare a new overhead performance report that will help Ron Kanobi assess efficiency and cost control in the Operations department. (10 Marks)

2. Do you think that the Director and the Department deserve a bonus? Explain your answer. (2 Marks)

The Star Worlds Company Performance Report-Operations Department Actual Budget Variance Units 34,000 30,000 Variable overhead costs: $ $ $ Tech support 20,750 18,000 2,750 UI Indirect labour 80,200 72,000 8,200 U Supplies 34,500 27,000 7,500 UI $ Maintenance 43,000 39,000 4,000 U 178,450 156,000 22,450 U Total variable overhead cost Fixed overhead cost: Supervision 1. T. Maintenance Depreciation 53,000 53,000 93,900 93,600 300U 36,400 36,400 Total fixed overhead cost 183,300 183,000 300U Total Overhead Cost 361,750 339,000 22,750 UI