Problem 9-25 Critiquing a Cost Report; Preparing a Performance Report [LO9-1, LO9-4, LO9-6] Frank Weston, supervisor of the Freemont Corporation's Machining Department, was visibly upset after being reprimanded for his department's poor performance over the prior month. The department's cost control report is given below: Freemont Corporation-Machining Department Cost Control Report For the Month Ended June 30 Actual Planning Results Budget Variances 42,000 40,000 Machine-hours Direct labor wages Supplies Maintenance Utilities Supervision Depreciation $ 96,100 $ 92,800 $ 3,300 U 30,800 26,500 24,200 60,000 27,600 3,200 U 23,800 1,700 U 22,500 1,700 U 60,000 105,000 105,000 10,900 Total 342,600 331,700 $ "l just can't understand all these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, I thought he was going to give me a pat on the back because I know for a fact that my department worked more efficiently last month than it has ever worked before. Instead, he tore me apart. I thought for a minute that it might be over the supplies that were stolen out of our warehouse last month. But they only amounted to a couple of hundred dollars, and just look at this report. Everything is unfavorable." Direct labor wages and supplies are variable costs; supervision and depreciation are fixed costs; and maintenance and utilities are mixed costs. The fixed component of the budgeted maintenance cost is $19,700; the fixed component of the budgeted utilities cost is $14,700