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 typical departmental cost report for a recent period 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 $ 9,900 $ 10,500 $ 600 F Scrap 35,000 37,500 2,500 F Indirect materials 101,000 120,000 19,000 F Fixed costs: Wages and salaries 79,900 75,000 4,900 U Equipment depreciation 105,000 105,000

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.

Complete the new performance report for the quarter, based on Flexible Budget Performance approach. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

	Actual results	Spending Variances	Spending Variances	Flexible Budgets	Activity Variances	Activity Variances	Planning Budget
Machine Hours (q)	15000		_		________>		20000
Supplies	9900						10500
Scrap	35000						37500
Indirect Materials	101000						120000
Wages and Salaries	79900						75000
Equipment Depreciation	105000						105000
Total	330800						348000

.

Were costs well controlled in March?

	Costs were well controlled
	Costs were not well controlled