Tota P24-1B Speier Company estimates that 240,000 direct labor hours will be worked during 2017 in the Assembly Department. On this basis, the following budgeted manufacturing overhead data are computed. Variable Overhead Costs Fixed Overhead Costs Indirect labor $ 72.000 Supervision $ 75,600 Indirect materials 48,000 Depreciation 30,000 Repairs 36,000 Insurance 12,000 Utilities 24000 Rent 9.600 Lubricants 12,000 Property taxes $192.000 $133 200 It is estimated that direct labor hours worked each month will range from 18,000 to 24,000 hours. During Jan 20,000 direct labor hours were worked and these overhead costs were incurred. Variable Overhead Costs Fixed Overhead Costs Indirect labor $ 6.200 Supervision S 6,300 Indirect materials 3 600 Depreciation 2,500 Repairs 2,300 Insurance 1,000 Utilities 1,700 Rent 850 Lubricants 1.050 Property taxes 500 $14.850 11.150 Fixe Sup Dep Insu Rent Prop Total Total Instructions (a) Prepare a monthly flexible manufacturing overhead budget for each increment of 2,000 direct labor hours over the relevant range for the year ending December 31, 2017 (b). Prepare a manufacturing overhead budget report for January (c) Comment on managements efficiency in controlling manufacturing over head costs in January - heading langu ages Select Editing Voice Styles PROBLEM 24-16 SPEIER COMPANY Flexible Monthly Manufacturing Overhead Budget Assembly Department For the Year 2017 nent. Activity Level Direct Labor Hours 18,000 20,000 22,000 24,000 ng Variable Costs: Total Variable Costs 000 were Fixed Costs: Supervision Depreciation Insurance Rent Property Taxes Total Fixed Costs Total Costs of 2,000 SPEIER COMPANY Manufacturing Overhead Budget Report (Flexible) Assembly Department For the Month Ended January 31, 2017 Activity Level Direct Labor Hours Variable Costs: Budget at 20,000 DLH Actual Costs 20,000 DLH Favorable Unfavorable Total Variable Costs Fixed Costs: Supervision Depreciation Insurance Rent Property Taxes Total Fixed Costs Total Costs P24-4B Guzman Inc operates the Home Appliance Division as a profit center Operating data for this division for the year ended December 31, 2017 are shown on the next page. Difference Budget from Budget Sales $2.400.000 $90,000 U Cost of goods sold Variable Controllable fixed 1,200 000 58,000 U 200 000 Selling and administrative 8,000 F Variable 240,000 Controllable fixed 8,000 60,000 Noncontrollable foxed costs 3000 U 50,000 2,000 0 In addition, Guzman incurs $150,000 of indirect fixed costs that were budgeted at $156,000 Twenty percent (20%) of these costs are allocated to the Home Appliance Division. None of these costs are controllable by the division manager Instructions (a) Prepare a responsibility report for the Home Appliance Division (a profit center) for the year. ) Comment on the manager's performance in controlling revenues and costs (c) Identify any costs excluded from the responsibility report and explain why they were excluded. PROBLEM 24-4B Responsibility Report For the Year Ended December 31, 2017 Favorable F Budget Actual Unfavorable U 2,400,000 2,310,000 90,000 U Sales Variable costs: Total Contribution Margin Controllable Fixed Costs: Focus - Total Controllable Margin (c) Two costs are excluded from the report. They are: (1) (2) The reason that they are excluded is