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 ResultsPlanning BudgetVariancesMachine-hours15,00020,000 Variable costs: Supplies$ 11,100$ 11,700$ 600FScrap40,60043,5002,900FIndirect materials115,400138,00022,600FFixed costs: Wages and salaries84,70079,0005,700UEquipment depreciation109,000109,0000 Total cost$ 360,800$ 381,200$ 20,400F

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 the new performance report for the quarter, based on Flexible Budget Performance approach. (Do not round you calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effec Input all amounts as positive values.) Complete the new performance report for the quarter, based on Flexible Budget Performance approach. (Do not round you calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effec Input all amounts as positive values.)