Question

please help with the incorrect ones in red, thanks!
Problem 23-2A a-b, d (Video) (Part Level Submission) Zelmer Company manufactures tablecloths. Sales have grown rapidly over the past 2 years. As a result, the president has installed a budgetary control system for 2020. The following data were used in developing the master manufacturing overhead budget for the Ironing Department, which is based on an activity index of direct labor hours. Rate per Direct Labor Hour Variable costs Annual Fixed Costs Indirect labor Indirect materials $0.40 0.50 0.30 0.20 Supervision Depreciation Insurance Rent $48,000 18,000 12,000 30,000 Factory utilities Factory repairs The master overhead budget was prepared on the expectation that 480,000 direct labor hours will be worked during the year. In June, 41,000 direct labor hours were worked. At that level of activity, actual costs were as shown below. Variable-per direct labor hour: indirect labor $0.44, indirect materials $0.48, factory utilities $0.32, and factory repairs $0.25. Fixed: same as budgeted.

Answer 1

Solution 1:

Zelmer Company
Ironing Department
Monthly Manufacturing overhead flexible budget
For the year 2020
Particulars	DLH - 35000	DLH - 40000	DLH - 45000	DLH - 50000
Direct labor hours	35000	40000	45000	50000
Variable Costs:
Indirect Labor	$14,000.00	$16,000.00	$18,000.00	$20,000.00
Indirect materials	$17,500.00	$20,000.00	$22,500.00	$25,000.00
Factory utilities	$10,500.00	$12,000.00	$13,500.00	$15,000.00
Factory repairs	$7,000.00	$8,000.00	$9,000.00	$10,000.00
Total variable costs	$49,000.00	$56,000.00	$63,000.00	$70,000.00
Fixed Costs:
Supervision	$4,000.00	$4,000.00	$4,000.00	$4,000.00
Depreciation	$1,500.00	$1,500.00	$1,500.00	$1,500.00
Insurance	$1,000.00	$1,000.00	$1,000.00	$1,000.00
Rent	$2,500.00	$2,500.00	$2,500.00	$2,500.00
Total Fixed Costs	$9,000.00	$9,000.00	$9,000.00	$9,000.00
Total Costs	$58,000.00	$65,000.00	$72,000.00	$79,000.00

Solution 2:

Zelmer Company
Ironing Department
Manufacturing overhead flexible budget report
For the month ended June 30, 2020
Particulars	Budget	Actual Cost	Variance	Favorable / Unfavorable / Neither favorable nor unfavorable
Variable Costs:
Indirect Labor	$16,400.00	$18,040.00	$1,640.00	Unfavorable
Indirect materials	$20,500.00	$19,680.00	$820.00	Favorable
Factory utilities	$12,300.00	$13,120.00	$820.00	Unfavorable
Factory repairs	$8,200.00	$10,250.00	$2,050.00	Unfavorable
Total variable costs	$57,400.00	$61,090.00	$3,690.00	Unfavorable
Fixed Costs:
Supervision	$4,000.00	$4,000.00	$0.00	Neither Favorable nor Unfavorable
Depreciation	$1,500.00	$1,500.00	$0.00	Neither Favorable nor Unfavorable
Insurance	$1,000.00	$1,000.00	$0.00	Neither Favorable nor Unfavorable
Rent	$2,500.00	$2,500.00	$0.00	Neither Favorable nor Unfavorable
Total Fixed Costs	$9,000.00	$9,000.00	$0.00	Neither Favorable nor Unfavorable
Total Costs	$66,400.00	$70,090.00	$3,690.00	Unfavorable