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.) Ray Company Production Department Flexible Budget Performance Report For the Month Ended August 31 Planning Budget Actual Results Flexible Activity Variances Spending Variances Budget Labor-hours (q) 9,590 9,110 q) $190,125 Direct labor 187,005 $ q) 3,394 F 18,079 Indirect labor 1.10 1,560 U 7,600 q) $ 864 U $ Utilities 23,998 q)$ 5,094 4,554 Supplies 4,410 $ 81,150 $ 18,920 Equipment depreciation 0 None 0 None $ q) Factory administration + 1.00 Total expense 344,736

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Answers are highlighted in yellow: Solution: (187005/9590) Ray Company Production Department Flexible Budget Performance Report For the Month Ended August 31 Actual Spending Results Variances Labor-hours (9) 9590 Direct labor $19.50 190125 3120U Indirect labor ($7530 + $ 1.10 ) 14685 3394 F Utilities 7600 + $ 1.809) 264221560 U Supplies $ 1,677 $ 0.30 g) 5094 540U Equipment depreciation 81150 81150 Onone Factory administration 18920 + 1.001) 27260 1250 F Total expense 3447361 576U Flexible Budget Activity Variances 9590 187005 93600 18079 528U 24862 8640 Planning Budget 9110 177645 (9110*19.50) 17551 (9100*1.1)+7530 23998|(23998-7600)/9030 + 4554 1440 4410 + 81150 O None 81150 285101 480U 34416011376 U 28030 (18920)+(9110*1.00) 332784 4554 4410 144 9590 9110 480 Supplies - Variable- (144/480) = $ 0.30 Supplies - Fixed- (4554)-(9590*.30) = $ 1,677