Static Budget venus Flexible Budget The production supervisor of the Machining Department for Hagerstown Company agreed to the following monthly static budget for the upcoming years Hagerstown Company Machining Department Monthly Production Budget Wages $574,000 30,000 Depreciation Total 51,000 $635,000 The actual amount spent and the actual units produced in the first three months in the Machining Department were Amount Spent Units Produced May June 1610.000 395.000 563.000 62.000 57,000 51.000 The Machining Department supervisor has been very pleased with this performance because actual expenditures for May-July have been significantly was than the monthly static budget of 655,000. However th plant manager believes that the budget should not remain foved for every month but should "fle" or adjust to the volume of work that is produced in the Machining Department. Additional budget information fo the Machining Department is as follows Wages per hour $17.00 Utility cost per direct labor hour Direct labor hours per unit Panned monthly unit production $0.90 0.50 68.000 Pracar a flexible bedoet for the actual units produced for Me June and Juv.in the Machining Department Assumereciation is a fixed cost. If required as per unit amounts cared out to decimal Check My Work Check My Work uses remaining Previous Ned a. Prepare a flexible budget for the actual units produced for May, June, and July in the Machieving Department. Assume depreciation is a fixed cost. If required, use per unit amounts carried out to two decimal places. Hagerstown Campany Machining Department Budget For the Three Months Ending July 31 Units of production Total Supporting calculations Units of production Hours per un Total hours of production Wages per hour Tag Total hours of production Unity costs per hour Total utides May 62,000 June July 57,000 51,000 62.000 57.000 b. Compare the fisible budget with the actual expenditures for the first this month May Chuck My Work Crack Myanmaning June July Your hours of production Wages per hour Total wages Total hours of production Utility costs per hour Total utilities b. Compare the flexible budget with the actual expenditures for the first three months. Total flexible budget Actual cost May June Excess of actual cost over budget What does this comparison suggest? The Machining Department has performed better than originally thought. The department is spending more than would be expected. Check My Work 3 more Check My Work uses remaining July