Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...
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Packaging Solutions 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 labor-hours worked in a month: Cost Formulas $16.60g $4,700 + $1.60g $5,200 + $0.70g $1,300 + SO.20g Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration $18,800 + $2.70g $8,300 $3,000 $13,800 + so.70g The Production Department planned to work 4,300 labor-hours in March; however, it actually worked 4,100 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March $ 69,700 $ 10,760 $ 8,600 $ 2,370 $29,870 $ 8,700 $ 3,000 $16,040 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Prepare the Production Department's flexible budget performance report for March, including both the spending and activity variances. Packaging Solutions 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 labor-hours worked in a month: Cost Formulas $16.60g $4,700 + $1.60g $5,200 + $0.70g $1,300 + SO.20g Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration $18,800 + $2.70g $8,300 $3,000 $13,800 + so.70g The Production Department planned to work 4,300 labor-hours in March; however, it actually worked 4,100 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March $ 69,700 $ 10,760 $ 8,600 $ 2,370 $29,870 $ 8,700 $ 3,000 $16,040 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Prepare the Production Department's flexible budget performance report for March, including both the spending and activity variances.
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Planning Budget for the Production Department based on 4300 laborhours Cost Formulas Direct labor 1660g Indirect labor 4700 160q Utilities 5200 070g S... View the full answer
Related Book For
Managing Business Process Flows Principles of Operations Management
ISBN: 978-0136036371
3rd edition
Authors: Ravi Anupindi, Sunil Chopra, Sudhakar Deshmukh, Jan Van Mieg
Posted Date:
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