Wade plc estimates that it will produce 6,000 units of product IOA during the current month. Budgeted variable manufacturing costs per unit are direct materials £7, direct labor £13, and overhead £18. Monthly budgeted fixed manufacturing overhead costs are £8,000 for depreciation and £3,800 for supervision.

In the current month, Wade actually produced 6,500 units and incurred the following costs: direct materials £38,850, direct labor £76,440, variable overhead £116,640, depreciation £8,000, and supervision £4,000.

Prepare a static budget report. The Budget column is based on estimated production while the Actual column is the actual cost incurred during the period. (Note: You do not need to prepare the heading.) Were costs controlled? Discuss limitations of the budget.