Westmont Corporation uses a comprehensive budgeting system for planning and control purposes. While departmental supervisors are happy with the system, the factory manager is not.

A report for the company's Assembly Department for March follows:

Assembly Department

Cost Report

For the Month Ended March $31$

Actual Results Planning Budget Variances

Machine$-$hours $25,00030,000$

Variable costs:

Supplies $ $7,200$ $ $7,800$ $ $600$ F

Scrap $22,40024,0001,600$ F

Indirect materials $68,60079,50010,900$ F

Fixed costs:

Wages and salaries $69,10066,0003,100$ U

Equipment depreciation $96,00096,0000$

Total cost $ $263,300$ $ $273,300$ $ $10,000$ F

After receiving this report, the supervisor of the Assembly Department stated, $$These reports are super. It makes me feel good to see how well things are going in my department. I can$$t understand why those people upstairs complain so much about the reports.$$

For the last several years, the company$$s marketing department chronically failed to meet the sales goals expressed in the company$$s monthly budgets.

Required:

The company$$s president is uneasy about the cost reports, identify at least two reasons.

What kind of reports should be used to give better insight into how well departmental supervisors are controlling costs?

Complete the new performance report for the quarter, based on Flexible Budget Performance approach.

Were costs well controlled in March?