Question

In Rooney Company, direct labor is $20 per hour. The company expects to operate at 12,000...

In Rooney Company, direct labor is $20 per hour. The company expects to operate at 12,000 direct labor hours each month. In January 2017, direct labor totaling $239,700 is incurred in working 12,500 hours.
Prepare a static budget report.

ROONEY COMPANY
Static Direct Labor Budget Report
For the Month Ended January 31, 2017
Product Line Budget Actual Difference

Direct Labor

 $ $ $

Favorable (correct)
Prepare a flexible budget report.

ROONEY COMPANY
Flexible Direct Labor Budget Report
For the Month Ended January 31, 2017
Product Line Budget Actual Difference

Direct Labor

 $ $ $

Favorable (correct)
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Answer #1
  • [1]

ROONEY COMPANY

Static Direct Labor Budget Report

For the Month Ended January 31, 2017

Product Line

Budget

Actual

Difference

Direct Labor

$240,000 [12000 hours x $ 20]

$239,700

$300

Favorable (correct)

  • [2]

ROONEY COMPANY

Flexible Direct Labor Budget Report

For the Month Ended January 31, 2017

Product Line

Budget

Actual

Difference

Direct Labor

$250,000 [12500 hours x $ 20]

$239,700

$10,300

Favorable (correct)

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