Please answer this QUESTION! Thank you Chapter 9 Homework Question 3 (of 3) valu
ID: 2550690 • Letter: P
Question
Please answer this QUESTION! Thank you
Chapter 9 Homework Question 3 (of 3) value: 5.00 points 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 40,000 Machine-hours Direct labor wages Supplies Maintenance 42,000 2,400 U 2.300 U $ 84,400 $ 82,000 26.300 24,900 22,000 2,900 U 22,600 20,700 1900 U 51,000 51,000 87,000 87,000 24,000 Supervision Depreciation Total $ 296,200 $ 286,700 S 9,500 U "I just can't understand all these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, thought he was going to give me a pat on the back because 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 stoler 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 $16,100; the fixed component of the budgeted utilities cost is $13,800 Required 2. Complete the performance report that will help Mr. Weston's superiors assess how well costs were controlled in the machining department. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Freemont Corporation-Machining Department Flexible Budget Performance Report For the Month Ended June 30 Actual Results Flexible Budget Planning Budget Spending Variances Activity Variances Direct labor wages Supplies Maintenance Utilities Supervision Depreciation Total S 84,400 26,300 24,900 22,600 51,000 87,000 S 296,200 S 82,000 24,000 22,000 20,700 51,000 87,000 S 286,700Explanation / Answer
Particulars Cost formula Actual Revenue and spending variance Flexible budget Activity variance Static budget Machine hours 42000 42000 40000 Direct labor wages 2.05q 84400 1700 F 86100 4100 U 82000 Supplies .6q 26300 1100 U 25200 1200 U 24000 Maintenance 16100+.1475q 24900 2605 U 22295 295 U 22000 utilities 13800+.1725q 22600 1555 U 21045 345 U 20700 Supervision 51000 51000 0 51000 0 51000 Depreciation 87000 87000 0 87000 0 87000 Total expense 296200 3560 U 292640 5940 U 286700