Question

Ray Company provided the following excerpts from its Production Department’s flexible budget performance report. (Round "rate per hour" answers to 2 decimal places. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

Required:

Complete the Production Department’s Flexible Budget Performance Report.

Ray Company
Production Department Flexible Budget Performance Report
For the Month Ended August 31
						Actual Results	Spending Variances		Flexible Budget	Activity Variances		Planning Budget
Labor-hours (q)						9,500						9,020
Direct labor	(		q)			$145,530			$142,500
Indirect labor	(		+	$1.10	q)		3,304	F	17,890
Utilities	(	$6,700	+		q)		1,470	U		432	U	14,818
Supplies	(		+		q)	4,968			4,464			4,320
Equipment depreciation	(	$78,900	)				0	None		0	None
Factory administration	(	$18,740	+	$1.10	q)
Total expense						$288,734

Answer 1

				Actual	Spending variance		Flexible	Activity variance		Planning
				results			budget			budget
labor hours				9,500			9,500			9,020
Direct labor			15	145,530	3,030	U	142,500	7,200	U	135300
Indirect labor		7,440	1.1	14,586	3,304	F	17,890	528	U	17362
Utilities		6,700	0.9	16,720	1,470	U	15,250	432	U	14,818
Supplies		1,614	0.3	4,968	504	U	4,464	144	U	4,320
Equipment depreciation		78,900		78,900	0	N	78,900	0	N	78,900
Factory administration		18,740	1.1	28,030	1,160	F	29190	528	U	28662
total expense				288,734	540	U	288,194	8,832	U	279362