Exercise 10-4 [Partially correct answer.] Your answer is partially correct. Try again. Myers Company uses a...

Exercise 10-4

[Partially correct answer.] Your answer is partially correct. Try again.

Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows.

Indirect labor $1.00
Indirect materials 0.70
Utilities 0.40

Fixed overhead costs per month are Supervision $4,200, Depreciation $1,800, and Property Taxes $600. The company believes it will normally operate in a range of 7,000–13,000 direct labor hours per month.

Assume that in July 2017, Myers Company incurs the following manufacturing overhead costs.

Variable Costs
Fixed Costs
Indirect labor $10,760 Supervision $4,200
Indirect materials 7,520 Depreciation 1,800
Utilities 3,950 Property taxes 600

(a) Prepare a flexible budget performance report, assuming that the company worked 11,000 direct labor hours during the month. (List variable costs before fixed costs.)

MYERS COMPANY
Manufacturing Overhead Flexible Budget Report
For the Month Ended July 31, 2017
Difference
Budget
Actual Costs
Favorable
Unfavorable
Neither Favorable
nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
$
[Entry field with correct answer]
$
[Entry field with correct answer]
$
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
$
[Entry field with incorrect answer]
$
[Entry field with correct answer]
$
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable

(b) Prepare a flexible budget performance report, assuming that the company worked 10,300 direct labor hours during the month. (List variable costs before fixed costs.)

MYERS COMPANY
Manufacturing Overhead Flexible Budget Report
For the Month Ended July 31, 2017
Difference
Budget
Actual Costs
Favorable
Unfavorable
Neither Favorable
nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with incorrect answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
$
[Entry field with incorrect answer]
$
[Entry field with correct answer]
$
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Unfavorable
Favorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with incorrect answer]
[Entry field with correct answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Unfavorable
Favorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with incorrect answer]
[Entry field with correct answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with incorrect answer]
[Entry field with correct answer]
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Unfavorable
Favorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
[Entry field with correct answer]
[Entry field with correct answer]
[Entry field with incorrect answer]
[Entry field with correct answer]

Favorable
Unfavorable
Neither Favorable nor Unfavorable
[Entry field with correct answer]

Depreciation
Direct Labor Hours
Fixed Costs
Indirect Labor
Indirect Materials
Property Taxes
Supervision
Total Costs
Total Fixed Costs
Total Variable Costs
Utilities
Variable Costs
$
[Entry field with incorrect answer]
$
[Entry field with correct answer]
$
[Entry field with incorrect answer]
[Entry field with incorrect answer]

Unfavorable
Favorable
Neither Favorable nor Unfavorable

Expert Solution


	MYERS COMPANY
	Manufacturing Overhead Flexible Budget Report
	For the month Ended Jul 31, 2017
	Particulars	Direct Labor Hours=11000
	Variable Manufacturing Costs:	Budgeted	Actual	Variance	F/A
	Indirect Labor	11000	10760	240	Favourable
	Indirect Material	7700	7520	180	Favourable
	Utilities	4400	3950	450	Favourable
	Total Variable Manufacturing Cost	23100	22230	870	Favourable

	Supervision	4200	4200	-	-
	Depreciation	1800	1800	-	-
	Propeerty Taxes	600	600	-	-
	Total Variable Manufacturing Cost	6600	6600	-	-

	Total Cost	29700	28830	870	Favourable


	MYERS COMPANY
	Manufacturing Overhead Flexible Budget Report
	For the month Ended Jul 31, 2017
	Particulars	Direct Labor Hours=10300
	Variable Manufacturing Costs:	Budgeted	Actual	Variance	F/A
	Indirect Labor	10300	10760	-460	Unfavourable
	Indirect Material	7210	7520	-310	Unfavourable
	Utilities	4120	3950	170	Favourable
	Total Variable Manufacturing Cost	21630	22230	-600	Unfavourable

	Supervision	4200	4200	-	-
	Depreciation	1800	1800	-	-
	Propeerty Taxes	600	600	-	-
	Total Variable Manufacturing Cost	6600	6600	-	-

	Total Cost	28230	28830	-600	Unfavourable


Note:	All Budgeted Variable Cost are calculated by Direct Labor Hours*Activity Rate

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