Packaging Solutions Corporation manufactures and sells a wide variety of packagi

Question

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 Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administratiorn $16.30g $4,100 $1.50q $5,600 $0.30g $1,400 $0.20q $18,600 $2.60g $8,500 $2,400 $13,100 $0.60g The Production Department planned to work 4,300 labor-hours in March; however, it actually worked 4,100 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Actual Cost Incurred in March 68,410 $ 9,730 $7,280 $2,470 $29,260 $8,900 $ 2,400 14,910

Explanation / Answer

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Packaging Solutions Corporation Production Department Planning Budget For the Month Ended March 31 Labour hours 4300 Direct labor 70090 Indirect labor 10550 Utilities 6890 Supplies 2260 Equipment depreciation 29780 Factory rent 8500 Property taxes 2400 Factory administration 15680 Total expense 146150

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