Mussatto Company expects to produce 47,160 units of product IOA during the curre

Question

Mussatto Company expects to produce 47,160 units of product IOA during the current year. Budgeted variable manufacturing costs per unit are direct materials $6, direct labor $13, and overhead $19. Annual budgeted fixed manufacturing overhead costs are $98,760 for depreciation and $48,132 for supervision. In the current month, Mussatto produced 6,340 units and incurred the following costs: direct materials $34,956, direct labor $80,549, variable overhead $129,163, depreciation $8,230, and supervision $4,215. Prepare a flexible budget report. (List variable costs before fixed costs.)

Explanation / Answer

Flexible Budget Report

Difference

Budget Actual

Difference

F / UF / None Units produced 6340 6340 Variable Costs: Direct Materials @6 $38040 $34956 $3084 F Direct Labor@13 82420 80549 1871 F Variable Overhead @19 120460 129163 8703 UF Total Variable Costs 240920 244668 3748 UF Fixed costs: Depreciation 8230 8230 0 None Supervision 4011 4215 204 UF Total Fixed Costs 12241 12445 204 UF Total Manufacturing Costs $253161 $257113 $3952 UF

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