Several years ago, Westmont Corporation developed a comprehensive budgeting system

for planning and control purposes. While departmental supervisors have been happy with

the system, the factory manager has expressed considerable dissatisfaction with the

information being generated by the system.

A report for the company's Assembly Department for the month of March follows:

After receiving a copy of this cost report, the supervisor of the Assembly Department

stated, "These reports are super. It makes me feel really good to see how well things are

going in my department. I can't understand why those people upstairs complain so much

about the reports."

For the last several years, the company's marketing department has chronically failed to

meet the sales goals expressed in the company's monthly budgets.

Required:

The company's president is uneasy about the cost reports, identify at least two

reasons.

What kind of reports should be used to give better insight into how well

departmental supervisors are controlling costs?

Complete the new performance report for the quarter, based on Flexible Budget

Performance approach.

Were costs well controlled in March?