Frank Weston, supervisor of the Freemont Corporation's Machining Department, was upset after being reprimanded for his department's poor performance over the prior month. The department's cost control report is given below: Freemont Corporation-Machining Department Machine-hours Direct labor wages Supplies Maintenance Utilities Supervision Depreciation Total Cost Control Report For the Month Ended June 30 Actual Results 42,000 $ 85,700 26,800 Planning Budget 40,000 $ 83,200 Variances $ 2,500 U 24,400 2,400 U 25,200 22,900 52,000 22,100 3,100 U 20,900 2,000 U 52,000 0 89,000 $ 301,600 89,000 $ 291,600 0 $ 10,000 U "I just can't understand all of these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, I thought he was going to give me a pat on the back because I know my department worked more efficiently last month than ever before. Instead, he tore me apart. I thought for a minute it might be over the supplies that were stolen out of our warehouse last month. But they only amounted to a couple of hundred dollars, and just look at this report. Everything is unfavorable." Direct labor wages and supplies are variable costs; supervision and depreciation are fixed costs; and maintenance and utilities are mixed costs. The fixed component of the budgeted maintenance cost is $16,500; the fixed component of the budgeted utilities cost is $13,900. Required: 2. Complete the performance report that will help Mr. Weston's superiors assess how well costs were controlled in the machining department.

Managerial Accounting

15th Edition

ISBN:9781337912020

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

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

Chapter2: Job Order Costing

Section: Chapter Questions

Problem 2TIF

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Frank Weston, supervisor of the Freemont Corporation's Machining Department, was upset after being reprimanded for his department's poor performance over the prior month. The department's cost control report is given below: Freemont Corporation-Machining Department Machine-hours Direct labor wages Supplies Maintenance Utilities Supervision Depreciation Total Cost Control Report For the Month Ended June 30 Actual Results 42,000 $ 85,700 26,800 Planning Budget 40,000 $ 83,200 Variances $ 2,500 U 24,400 2,400 U 25,200 22,900 52,000 22,100 3,100 U 20,900 2,000 U 52,000 0 89,000 $ 301,600 89,000 $ 291,600 0 $ 10,000 U "I just can't understand all of these unfavorable variances," Weston complained to the supervisor of another department. "When the boss called me in, I thought he was going to give me a pat on the back because I know my department worked more efficiently last month than ever before. Instead, he tore me apart. I thought for a minute it might be over the supplies that were stolen out of our warehouse last month. But they only amounted to a couple of hundred dollars, and just look at this report. Everything is unfavorable." Direct labor wages and supplies are variable costs; supervision and depreciation are fixed costs; and maintenance and utilities are mixed costs. The fixed component of the budgeted maintenance cost is $16,500; the fixed component of the budgeted utilities cost is $13,900. Required: 2. Complete the performance report that will help Mr. Weston's superiors assess how well costs were controlled in the machining department.

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