Packaging Solutions Corporation manufactures and sells a wide variety of packagi
ID: 2551066 • Letter: P
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:
The actual costs incurred in March in the Production Department are listed below:
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:
1. The company had budgeted for an activity level of 4,200 labor-hours in March. Complete the Production Department's planning budget for the month. Packaging Solutions Corporation Production Department Planning Budget For the Month Ended March 31 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expense 2. The company actually worked 4,000 labor-hours in March. Complete the Production Department's flexible budget for the month. Packaging Solutions Corporation Production Department Flexible Budget For the Month Ended March 31 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Total expenseExplanation / Answer
Planning budget Direct labor 69300 =4200*16.5 Indirect labor 11220 =4500+(4200*1.6) Utilities 8460 =5100+(4200*0.8) Supplies 1820 =1400+(4200*0.1) Equipment depreciation 29020 =18100+(4200*2.6) Factory rent 8100 Property taxes 2500 Factory administration 15520 =13000+(4200*0.6) Total expense 145940 Flexible budget Direct labor 66000 =4000*16.5 Indirect labor 10900 =4500+(4000*1.6) Utilities 8300 =5100+(4000*0.8) Supplies 1800 =1400+(4000*0.1) Equipment depreciation 28500 =18100+(4000*2.6) Factory rent 8100 Property taxes 2500 Factory administration 15400 =13000+(4000*0.6) Total expense 141500 Spending variances Direct labor 1620 U Indirect labor 500 F Utilities 550 U Supplies 230 U Equipment depreciation 0 None Factory rent 400 U Property taxes 0 None Factory administration 650 F Total expense 1650 U
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.