Ronson Products, Ltd., an Australian company, has the following cost formulas (expressed in Australian dollars) for variable overhead costs in one of its machine shops:
Variable Cost Formula
Overhead Cost (per machine-hour)
Supplies . . . . . . . . . . . . . $0.70
Power . . . . . . . . . . . . . . . 1.20
Lubrication . . . . . . . . . . . 0.50
Wearing tools . . . . . . . . . 3.10
Total . . . . . . . . . . . . . . . . $5.50

During July, the machine shop was scheduled to work 3,200 machine-hours and to produce 16,000 units of product. The standard machine time per unit of product is 0.2 hours. A severe storm during the month forced the company to close for several days, which reduced the level of output for the month.
Actual results for July were as follows:
Actual machine-hours worked . . . . . . . . . . 2,700
Actual number of units produced. . . . . . . . 14,000
Actual costs for July were:

Required:
Prepare an overhead performance report for the machine shop for July. Use column headings in your report as shownbelow:

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FlexibleFlexibl Actual Budget Budget CostsBased Based Breakdown of the Total Variance Cost Incurred, on on Overhead Formula 2,700 Total Spending Eficianoy MHs Variance Variance