Question

CALCULATOR PRINTER VERSION BACK NEXT Problem IU JA a, b, c (Video) Ratchet Company uses budgets in controlling costs. The August 2020 budget report for the company's Assembling Department is as follows. RATHIET COMPANY Budget Report Assembling Department For the Month Ended August 31, 2020 Difference Favorable Unfavorable Neither Favorable Manufacturing Costs Budget Actual nor Unfavorable Variable costs Direct materials $57,200 $56,100 $1,100 Favorable Direct labor 61,100 57,600 3,500 Favorable Indirect materials 26.000 26,100 100 Unfavorable Indirect labor 24,700 24,300 400 Favorable Utilities 19,500 19,330 170 Favorable Maintenance 7,800 8,170 370 Unfavorable Total variable 196,300 191,600 4,700 Favorable Fixed costs 10,300 10,300 -0- Neither Favorable nor Unfavorable Supervision 18,300 18,300 -0-Neither Favorable nor Unfavorable Depreciation 6,800 6,800 -0-Neither Favorable nor Unfavorable Total forced 35,400 35.400 -- Neither Favorable nor Unfavorable Total costs $231,700 $227,000 $4,700 Favorable The monthly budget amounts in the report were based on an expected production of 65,000 units per month or 780,000 units per year. The Assembling Department manager is pleased with the report and expects a raise, or at least praise for a job well done. The company president, however, is unhappy with the results for August because only 63,000 units were produced

Answer 1

RATCHET COMPANY
Assembly Department
Manufacturing Overhead Flexible Budget Report
For the Month Ended June 30, 2017
	Budget	Actual Costs	Difference
Direct Labor Hours	63000	63000
Variable Costs
Direct materials	$55,440	$56,100	$660	Unfavorable
Direct labor	$59,220	$57,600	$1,620	Favorable
Indirect materials	$25,200	$26,100	$900.00	Unfavorable
Indirect labor	$23,940	$24,300	$360.00	Unfavorable
Utilities	$18,900	$19,330	$430.00	Unfavorable
Maintenance	$7,560	$8,170	$610.00	Unfavorable
Total Variable Costs	$190,260.00	$191,600.00	$1,340.00	Unfavorable
Fixed Costs
Supervision	$10,300.00	$10,300.00	$0.00	Neither Favorable nor Unfavorable
Depreciation	$18,300.00	$18,300.00	$0.00	Neither Favorable nor Unfavorable
Insurance	$6,800.00	$6,800.00	$0.00	Neither Favorable nor Unfavorable
Total Fixed Costs	$35,400.00	$35,400.00	$0.00	Neither Favorable nor Unfavorable
Total Cost	$225,660.00	$227,000.00	$1,340.00	Unfavorable

А C D Е Favorable F 7 8 Manufacturing Costs Unfavorable U Budget Actual Neither Favorable 10 nor Unfavorable N 11 Variable costs Direct materials 57200 56100 12 1000 Direct labor 57600 13 61100 2780 F 26100 24300 19330 240 14 Indirect materials 26000 U 24700 450 15 Indirect labor 16 Utilities 19500 100 7800 17 Maintenance 8170 110 U Total variable -SUM(C12:C17) sUM(B12:B17) 18 3980 19 Fixed costs 10300 20 Rent 10300 -0 N Supervision 18300 21 18300 6800 -0- N Depreciation 22 6800 -0- N -0- 23 Total fixed B20+B21+B22 -C20+C21+C22 N -B18+ B23 3С18+C23 24 Total costs -B24-C24 25 26 (b) Prepare a budget report for June comparing actual results with budget data based on the flexi ble budg 28 RATCHET COMPANY 29 Assembly Department 30 Manufacturing Overhead Flexi ble Budget Report 31 For the Month Ended June 30, 2017 32 Budget 63000 Actual Costs Difference 33 Direct Labor Hours 63000 34 Variable Costs B12/65000 SB$33 -B13/65000 SB$33 - B14 / 65000 $B$33 -B15/65000 $B$33 -B16/65000 $B$33 -B17/65000 $B$33 -SUM(B35: B40) 35 Direct materials - C12 %3С35-В35 Unfavorable -в36-С36 36 Direct labor -C13 Favorable Indirect materials 37 -C14 3С37-В37 Unfavorable Indirect labor 38 -C15 3С38-В38 Unfavorable 39 Utilities -C16 3С39-В39 Unfavorable 40 Maintenance -C17 3С40-В40 Unfavorable -SUM(C35:C40 ) 41 Total Variable Costs -C41 - B41 Unfavorable 42 Fixed Costs - C20 Neither Favorable nor Unf 43 Supervision -B43 3В43-С43 44 Depreciation -С21 - B44 -B44-C44 Neither Favorable nor Unf - B45 45 Insurance -C22 -B45-C45 Neither Favorable nor Unf =SUM(B43:B45) -B41+ B46 46 Total Fixed Costs -B46 - B46- C46 Neither Favorable nor Unf -C41+C46 Unfavorable 47 Total Cost C47-B47