The production supervisor of the Machining Department for Niland Company agreed to the following monthly static budget for the upcoming year:

Niland Company Machining Department Monthly Production Budget: Wages $211,000 Utilities 13,000 Depreciation 23,000 Total $247,000

The actual amount spent and the actual units produced in the first three months in the Machining Department were as follows:

Amount Spent, Units Produced January $234,000 51,000 February 226,000 47,000 March 214,000 42,000

The Machining Department supervisor has been very pleased with this performance because actual expenditures for JanuaryMarch have been less than the monthly static budget of $247,000. However, the plant manager believes that the budget should not remain fixed for every month but should flex or adjust to the volume of work that is produced in the Machining Department.

Additional budget information for the Machining Department is as follows:

Wages per hour $19.00 Utility cost per direct labor hour $1.20 Direct labor hours per unit 0.20 Planned monthly unit production 56,000

a. Prepare a flexible budget for the actual units produced for January, February, and March in the Machining Department. Assume that depreciation is a fixed cost. Enter all amounts as positive numbers. If required, use per unit amounts carried out to two decimal places.

Niland Company-Machining Department Flexible Production Budget For the Three Months Ending March 31

	jan	feb	march
Units of production
Wages
Utilities
Depreciation
Total

Compare the flexible budget with the actual expenditures for the first three months.

	jan	feb	march
Total flexible budget
Actual cost
Excess of actual cost over budget