In the Assembly Department of Hannon Company, budgeted and actual manufacturing

Question

In the Assembly Department of Hannon Company, budgeted and actual manufacturing overhead costs for the month of April 2017 were as follows. Budget Actual Indirect materials Indirect labor Utilities Supervision $15,300 19,800 10,100 5,800 $14,700 20,300 10,900 5,800 All costs are controllable by the department manager. Prepare a responsibility report for April for the cost center. HANNON COMPANY Assembly Department ring Overhead Cost Responsibility Report For the Month Ended April 30, 2017 Difference Favorable Unfavorable Neither Favorable nor Unfavorable Controllable Cost Budget Actual

Explanation / Answer

HANNON COMPANY Assembly Department Manufacturing overhead Cost Responsibility Report For the month ended April 30, 2017 Difference Favorable Unfavorable Neither favorable nor Unfavorable Controllable cost Budget Actual Indirect Materials $         15,300 $     14,700 $ 600 Favorable Indirect Labor $         19,800 $     20,300 $ 500 Unfavorable Utilities $         10,100 $     10,900 $ 800 Unfavorable Supervision $           5,800 $        5,800 0 Neither favorable nor Unfavorable When Actual expense is more than budgeted it will be unfavorable difference and if actual is lower than budgeted it will be favorable.

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