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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 | $ | 4,500 | + | $ | 1.90 | q |
| Utilities | $ | 5,300 | + | $ | 0.40 | q |
| Supplies | $ | 1,300 | + | $ | 0.20 | q |
| Equipment depreciation | $ | 18,700 | + | $ | 2.60 | q |
| Factory rent | $ | 8,200 | ||||
| Property taxes | $ | 2,700 | ||||
| Factory administration | $ | 13,300 | + | $ | 0.70 | q |
| The actual costs incurred in November in the Production Department are listed below: |
| Actual Cost Incurred in November | ||
| Direct labor | $ | 67,980 |
| Indirect labor | $ | 11,850 |
| Utilities | $ | 7,410 |
| Supplies | $ | 2,370 |
| Equipment depreciation | $ | 29,360 |
| Factory rent | $ | 8,600 |
| Property taxes | $ | 2,700 |
| Factory administration | $ | 15,540 |
| Required: | |
| 1. | The company had budgeted for an activity level of 4,300 labor-hours in November. Prepare the Production Department |
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