Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost FormulasDirect labor$16.40qIndirect labor$4,000 + $1.40qUtilities$5,300 + $0.30qSupplies$1,600 + $0.10qEquipment depreciation$18,500 + $3.00qFactory rent$8,200Property taxes$2,500Factory administration$13,600 + $0.60qThe Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in MarchDirect labor$ 70,480Indirect labor$ 9,340Utilities$ 7,010Supplies$ 2,250Equipment depreciation$ 31,100Factory rent$ 8,600Property taxes$ 2,500Factory administration$ 15,470Required:Prepare the Production Department’s planning budget for the month.Prepare the Production Department’s flexible budget for the month.Prepare the Production Department’s flexible budget performance report for March, including both the spending and activity variances. Exercise 9-14 (Algo) Flexible Budget Performance Report in a Cost Center [LO9-1, LO9-2, LO9-3, LO9-4]Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are preparedmonthly for each department. The planning budget and flexible budget for the Production Department are based on the followingformulas, where is the number of labor-hours worked in a month:Direct laborIndirect laborUtilitiesSuppliesEquipment depreciationFactory rentProperty taxesFactory administrationThe Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during themonth. Its actual costs incurred in March are listed below:Direct laborIndirect laborUtilitiesSuppliesEquipment depreciationFactory rentProperty taxesFactory administrationCost Formulas$16.409$4,000+ $1.499.$5,300+ $0.309$1,600+ $0.10q$18,500+ $3.009$8,200$2,500$13,600 + $0.60gActual CostIncurred inMarchRequired:1. Prepare the Production Department's planning budget for the month.2. Prepare the Production Department's flexible budget for the month.3. Prepare the Production Department's flexible budget performance report for March, Including both the spending and activityvariances.Direct laborIndirect laborUtilitiesSuppliesEquipment depreciation$ 70,480$ 9,340$ 7,010$2,250$ 31,100$ 8,600$ 2,500$ 15,470Complete this question by entering your answers in the tabs below.Factory rentProperty taxesFactory administrationTotal expenseRequired 1 Required 2Prepare the Production Department's flexible budget for the month.Packaging Solutions CorporationProduction Department Flexible BudgetFor the Month Ended March 31Required 3< Required 1Required 3 > Required:1. Prepare the Production Department's planning budget for the month.2. Prepare the Production Department's flexible budget for the month.3. Prepare the Production Department's flexible budget performance report for March, including both the spending and activityvariances.Complete this question by entering your answers in the tabs below.Required 1 Required 2 Required 3Prepare the Production Department's flexible budget performance report for March, including both the spending and activityvariances.Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zerovariance). Input all amounts as positive values.Labor-hoursDirect laborIndirect laborUtilitiesSuppliesEquipment depreciationFactory rentProperty taxesFactory administrationTotal expensePackaging Solutions CorporationProduction Department Flexible Budget Performance ReportFor the Month Ended March 31ActualResults4,200$ 70,4809,3407,0102,25031,1008,6002,50015,470$ 148,750< Required 2FlexibleBudgetRequired 3 >PlanningBudgetShow less A

Direct costs are the expenses that are directly used for the production of goods and services for…

Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.40q Indirect labor $4,000 + $1.40q Utilities $5,300 + $0.30q Supplies $1,600 + $0.10q Equipment depreciation $18,500 + $3.00q Factory rent $8,200 Property taxes $2,500 Factory administration $13,600 + $0.60q The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 70,480 Indirect labor $ 9,340 Utilities $ 7,010 Supplies $ 2,250 Equipment depreciation $ 31,100 Factory rent $ 8,600 Property taxes $ 2,500 Factory administration $ 15,470 Required: Prepare the Production Department’s planning budget for the month. Prepare the Production Department’s flexible budget for the month. Prepare the Production Department’s flexible budget performance report for March, including both the spending and activity variances.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 1E: Budget performance reports for cost centers Partially completed budget performance reports for...

See similar textbooks

	Cost Formulas
Direct labor	$16.40q
Indirect labor	$4,000 + $1.40q
Utilities	$5,300 + $0.30q
Supplies	$1,600 + $0.10q
Equipment depreciation	$18,500 + $3.00q
Factory rent	$8,200
Property taxes	$2,500
Factory administration	$13,600 + $0.60q

	Actual Cost Incurred in March
Direct labor	$ 70,480
Indirect labor	$ 9,340
Utilities	$ 7,010
Supplies	$ 2,250
Equipment depreciation	$ 31,100
Factory rent	$ 8,600
Property taxes	$ 2,500
Factory administration	$ 15,470

Required:

Prepare the Production Department’s planning budget for the month.
Prepare the Production Department’s flexible budget for the month.
Prepare the Production Department’s flexible budget performance report for March, including both the spending and activity variances.

Exercise 9-14 (Algo) Flexible Budget Performance Report in a Cost Center [LO9-1, LO9-2, LO9-3, LO9-4]
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared
monthly for each department. The planning budget and flexible budget for the Production Department are based on the following
formulas, where is the number of labor-hours worked in a month:
Direct labor
Indirect labor
Utilities
Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the
month. Its actual costs incurred in March are listed below:
Direct labor
Indirect labor
Utilities
Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
Cost Formulas
$16.409
$4,000+ $1.499.
$5,300+ $0.309
$1,600+ $0.10q
$18,500+ $3.009
$8,200
$2,500
$13,600 + $0.60g
Actual Cost
Incurred in
March
Required:
1. Prepare the Production Department's planning budget for the month.
2. Prepare the Production Department's flexible budget for the month.
3. Prepare the Production Department's flexible budget performance report for March, Including both the spending and activity
variances.
Direct labor
Indirect labor
Utilities
Supplies
Equipment depreciation
$ 70,480
$ 9,340
$ 7,010
$2,250
$ 31,100
$ 8,600
$ 2,500
$ 15,470
Complete this question by entering your answers in the tabs below.
Factory rent
Property taxes
Factory administration
Total expense
Required 1 Required 2
Prepare the Production Department's flexible budget for the month.
Packaging Solutions Corporation
Production Department Flexible Budget
For the Month Ended March 31
Required 3
< Required 1
Required 3 >

Required:
1. Prepare the Production Department's planning budget for the month.
2. Prepare the Production Department's flexible budget for the month.
3. Prepare the Production Department's flexible budget performance report for March, including both the spending and activity
variances.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3
Prepare the Production Department's flexible budget performance report for March, including both the spending and activity
variances.
Note: 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.
Labor-hours
Direct labor
Indirect labor
Utilities
Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
Total expense
Packaging Solutions Corporation
Production Department Flexible Budget Performance Report
For the Month Ended March 31
Actual
Results
4,200
$ 70,480
9,340
7,010
2,250
31,100
8,600
2,500
15,470
$ 148,750
< Required 2
Flexible
Budget
Required 3 >
Planning
Budget
Show less A

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 5 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.