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:

Assembly Department Cost Report For the Month Ended March 31
	Actual Results	Planning Budget	Variances
Machine-hours	15,000	20,000
Variable costs:
Supplies	$ 9,000	$ 9,600	$ 600	F
Scrap	30,800	33,000	2,200	F
Indirect materials	90,200	106,500	16,300	F
Fixed costs:
Wages and salaries	76,300	72,000	4,300	U
Equipment depreciation	102,000	102,000	0
Total cost	$ 308,300	$ 323,100	$ 14,800	F

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 cant understand why those people upstairs complain so much about the reports.

For the last several years, the companys marketing department has chronically failed to meet the sales goals expressed in the companys monthly budgets.

Required:

1. The companys president is uneasy about the cost reports, identify at least two reasons.

2. What kind of reports should be used to give better insight into how well departmental supervisors are controlling costs?

3. Complete the new performance report for the quarter, based on Flexible Budget Performance approach.

4. Were costs well controlled in March?

Complete this question by entering your answers in the tabs below. The company's president is uneasy about the cost reports, identify at least two reasons. (Select " X " if the item is one of the reasons.) Complete this question by entering your answers in the tabs below. What kind of reports should be used to give better insight into how well departmental supervisors are co calculations. Indicate the effect of each variance by sesed on Flexible Budget Performance approach. (Do not round your intermediate input all amounts as positive values.) Complete this question by entering your answers in the tabs below. Were costs well controlled in March? Costs were well controlled Costs were not well controlled