Variable costs Direct materials $54,180 $53,080 $1,100 Favorable Direct labor 60,480 57,080 3,400 Favorable Indirect materials 30,240 30,440 200 Unfavorable Indirect labor 21,420 21,020 400 Favorable Utilities 18,900 18,800 100 Favorable Maintenance 10,080 10,440 360 Unfavorable Total variable 195,300 190,860 4,440 Favorable Fixed costs Rent 11,100 11,100 Supervision 16,000 Depreciation 6,800 16,000 6,800 -0- Neither Favorable nor Unfavorable -0- Neither Favorable nor Unfavorable -0- Neither Favorable nor Unfavorable Total fixed Total costs 33,900 33,900 -0- Neither Favorable nor Unfavorable $229,200 $224,760 $4,440 Favorable The monthly budget amounts in the report were based on an expected production of 63,000 units per month or 756,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 61,000 units were produced.