B&L; Landscapes, Inc. Mini Practice Part 5 Bill Graham and Larry Miller incorpor

Question

B&L; Landscapes, Inc. Mini Practice Part 5 Bill Graham and Larry Miller incorporated B&L; Landscapes, Inc. on July 1, 2014The business consists of lawn care and sprinkler system installations. In addition, they also sell two types of fertilizer During 2015, B&L; Landscapes, Inc. acquired a 30% interest in Crestline Pipe. The president of Crestline wants to develop a management report to evaluate Manufacturing Overhead costs. Bill and Larry want to help and have volunteered your services to provide some managerial reporting for Crestline. Crestline Pipe distributes high-quality PVC pipe and has the following informmation for the month of March, 2015 Crestline Pipe Manufacturing Overhead Budget (Static) For the Month of March, 2015 Badgetod production in LF 117.500 Budgeted costs Indirect materials (50 30 DLH) 705 Indirect labor (50 50 DLI)11.750 Utilisies (50.40 DLH)40 Maintenance (5o.25Du 875 Salaries42000 Depreciation 16,800 Property taxes 2,00 Insurance1.200 Janitorial1300 Total budgrted costs $97 875 Crestline Pipe Manufacturing Overhead Costs (Actual) For the Month of March, 2015 Actual cests Indirect materials) 7,100 Indirect labor 11,825 Ublinies 10,700 16430245 2learn.com/d2e/dropbox/1525475/1065466/Downlo dAtachment?fid

Explanation / Answer

DLH = LF/5 Flexible Budget 115500 116500 117500 118500 119500 DLH 23100 23300 23500 23700 23900 Indirect materials ($0.30/DLH) 6930 6990 7050 7110 7170 Indirect labor ($0.50/DLH) 11550 11650 11750 11850 11950 Utilities ($0.40/DLH) 9240 9320 9400 9480 9560 Maintenance ($0.25/DLH) 5775 5825 5875 5925 5975 Salaries 42,000 42,000 42,000 42,000 42,000 Depreciation 16,800 16,800 16,800 16,800 16,800 Property taxes 2,500 2,500 2,500 2,500 2,500 Insurance 1,200 1,200 1,200 1,200 1,200 Janitorial 1,300 1,300 1,300 1,300 1,300 Total budgeted costs 97295 97585 97875 98165 98455 Actual Variance Remarks Budget Static Volume 118500 117500 Indirect materials ($0.30/DLH) $ 7,100 $ -50 U $ 7,050 Indirect labor ($0.50/DLH) 11,825 $ -75 U 11,750 Utilities ($0.40/DLH) 10,700 $ -1,300 U 9,400 Maintenance ($0.25/DLH) 5,900 $ -25 U 5,875 Total $ 35,525 $ -1,450 U $ 34,075 Flexible Variance Remarks Actual Volume 118500 118500 Indirect materials ($0.30/DLH) 7110 $ 10 F $ 7,100 Indirect labor ($0.50/DLH) 11850 $ 25 F 11,825 Utilities ($0.40/DLH) 9480 $ -1,220 U 10,700 Maintenance ($0.25/DLH) 5925 $ 25 F 5,900 Total $ 34,365 $ -1,160 U $ 35,525 As per Flexible budget Utilities has generated unfavorable variance of 1220 which should be investigated further and manufacturing manager should be held responible for the same

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