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In: Accounting

Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...

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
Direct labor $16.50q
Indirect labor $4,200 + $1.40q
Utilities $5,200 + $0.40q
Supplies $1,300 + $0.10q
Equipment depreciation $18,400 + $2.80q
Factory rent $8,300
Property taxes $2,800
Factory administration $13,300 + $0.50q

The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below:

Actual Cost Incurred in March
Direct labor $ 70,920
Indirect labor $ 9,540
Utilities $ 7,350
Supplies $ 1,950
Equipment depreciation $ 30,160
Factory rent $ 8,700
Property taxes $ 2,800
Factory administration $ 14,730

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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Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...
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 Direct labor $16.30q Indirect labor $4,500 + $1.40q Utilities $5,400 + $0.60q Supplies $1,200 + $0.20q Equipment depreciation $18,300 + $2.90q Factory rent $8,100 Property taxes $2,400 Factory administration $13,000 +...
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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 Direct labor $16.30q Indirect labor $4,700 + $1.90q Utilities $5,300 + $0.40q Supplies $1,300 + $0.20q Equipment depreciation $18,500 + $2.70q Factory rent $8,500 Property taxes $2,700 Factory administration $13,300 +...
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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 Direct labor $16.40q Indirect labor $4,400 + $1.40q Utilities $5,600 + $0.60q Supplies $1,600 + $0.30q Equipment depreciation $18,700 + $2.80q Factory rent $8,400 Property taxes $2,800 Factory administration $13,300 +...
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...
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 Direct labor $16.30q Indirect labor $4,700 + $1.40q Utilities $5,400 + $0.80q Supplies $1,800 + $0.30q Equipment depreciation $18,600 + $2.40q Factory rent $8,100 Property taxes $2,400 Factory administration $13,300 +...
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...
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 Direct labor $16.20q Indirect labor $4,100 + $1.50q Utilities $5,000 + $0.30q Supplies $1,200 + $0.40q Equipment depreciation $18,600 + $2.40q Factory rent $8,000 Property taxes $2,500 Factory administration $13,300 +...
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared...
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 Direct labor $16.20q Indirect labor $4,400 + $1.70q Utilities $5,500 + $0.30q Supplies $1,800 + $0.40q Equipment depreciation $18,600 + $2.40q Factory rent $8,100 Property taxes $2,500 Factory administration $13,100 +...
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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...
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 Direct labor $16.60q Indirect labor $4,800 + $1.30q Utilities $5,700 + $0.70q Supplies $1,600 + $0.20q Equipment depreciation $18,800 + $2.50q Factory rent $8,600 Property taxes $2,600 Factory administration $13,600 +...
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