Question
Triway Packaging Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible
| Triway Packaging Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of direct labor-hours worked in a month: |
| Direct labor | $ | 16.20 | q | |||
| Indirect labor | $ | 4,600 | + | $ | 2.10 | q |
| Utilities | $ | 5,200 | + | $ | 0.50 | q |
| Supplies | $ | 1,500 | + | $ | 0.30 | q |
| Equipment depreciation | $ | 18,000 | + | $ | 2.90 | q |
| Factory rent | $ | 8,300 | ||||
| Property taxes | $ | 2,500 | ||||
| Factory administration | $ | 13,200 | + | $ | 0.70 | q |
| The actual costs incurred in November in the Production Department are listed below: |
| Actual Cost Incurred in November | ||
| Direct labor | $ | 69,600 |
| Indirect labor | $ | 13,020 |
| Utilities | $ | 7,790 |
| Supplies | $ | 3,030 |
| Equipment depreciation | $ | 30,180 |
| Factory rent | $ | 8,700 |
| Property taxes | $ | 2,500 |
| Factory administration | $ | 15,510 |
| Required: | |
| 1. | The company had budgeted for an activity level of 4,400 labor-hours in November. Prepare the Production Departments planning budget for the month. (Omit the "$" sign in your response.) |
| Triway Packaging Corporation Production Department Planning Budget For the Month Ended November 30 | |
| Direct labor | $ |
| Indirect labor | |
| Utilities | |
| Supplies | |
| Equipment depreciation | |
| Factory rent | |
| Property taxes | |
| Factory administration | |
| Total expense | $ |
| 2. | The company actually worked 4,200 labor-hours in November. Prepare the Production Departments flexible budget for the month. (Omit the "$" sign in your response.) |
| Triway Packaging Corporation Production Department Flexible Budget For the Month Ended November 30 | |
| Direct labor | $ |
| Indirect labor | |
| Utilities | |
| Supplies | |
| Equipment depreciation | |
| Factory rent | |
| Property taxes | |
| Factory administration | |
| Total expense | $ |
| 3. | Complete the Production Departments flexible budget performance report for November, including both the activity and spending variances. (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Omit the "$" sign in your response.) |
| Triway Packaging Corporation Production Department Flexible Budget Performance Report For the Month Ended November 30 | ||||
| Activity Variances | Spending Variances | |||
| Direct labor | $ | (Click to select)FNoneU | $ | (Click to select)UFNone |
| Indirect labor | (Click to select)FNoneU | (Click to select)FUNone | ||
| Utilities | (Click to select)FUNone | (Click to select)UNoneF | ||
| Supplies | (Click to select)FUNone | (Click to select)FUNone | ||
| Equipment depreciation | (Click to select)FUNone | (Click to select)NoneUF | ||
| Factory rent | (Click to select)FNoneU | (Click to select)UFNone | ||
| Property taxes | (Click to select)NoneUF | (Click to select)UNoneF | ||
| Factory administration | (Click to select)NoneFU | (Click to select)NoneUF | ||
| Total expense | $ | (Click to select)NoneUF | $ | (Click to select)UNoneF |
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Auditing And Assurance Services An Integrated Approach
Authors: Alvin A. Arens, Randal J. Elder, Mark S. Beasley, Chris E. Hogan
18th Edition
0137879199, 9780137879199
