Question

Strickland Crop's manufacturing overhead budget for the first quarter of 2013 contained the following data:

Variable Costs   

Indirect materials $40,000

Indirect labor $24,000

Utilities $20,000

Maintenance   $12,000

Fixed Cost

Supervisor's salary $80,000

Depreciation $16,000

Property taxes $8000

Actual variable cost for the first quarter were:

indirect materials $37200

indirect labor $26400

utilities $21000

maintenance $10600

Actual fixed costs were as expected except for the property taxes which were $9000.

All cost are considered controllable by the department manger except for the supervisor's salary.

Instructions

Prepare a manufacturing overhead responsibility performance report for the first quarter.

Answer 1

Strickland Corp
Manufacturing overhead responsibility report
For the quarter ended March 31, 2013
	Budget	Actual costs	Differences
Indirect material	$               40,000	$      37,200	$       2,800	Favorable
Indirect labor	$               24,000	$      26,400	$       2,400	Unfavorable
Utilities	$               20,000	$      21,000	$       1,000	Unfavorable
Maintenance	$               12,000	$      10,600	$       1,400	Favorable
Depreciation	$               16,000	$      16,000	$              -	Neither favorable nor unfavorable
Property taxes	$                  8,000	$        9,000	$       1,000	Unfavorable