Pronghorn Company expects to produce 1,248,000 units of Product XX in 2022. Monthly production is expected to range from 83,200 to 124,800 units. Budgeted variable manufacturing costs per unit are direct materials $5, direct labor $6, and overhead $8. Budgeted foxed manufacturing costs per unit for depreciation are $2 and for supervision are $1. In March 2022, the company incurs the following costs in producing 104,000 units: direct materials $540,800, direct labor $619,840, and variable overhead $837,200. Actual foxed costs were equal to budgeted foxed costs. Prepare a flexible budget report for March. (List variable costs before fixed costs) > > > Budget PRONGHORN COMPANY Manufacturing Flexible Budget Report Actual Difference Favorable Unfavorable Neither Favorable nor Unfavorable 0000
Pronghorn Company expects to produce 1,248,000 units of Product XX in 2022. Monthly production is expected to range from 83,200 to 124,800 units. Budgeted variable manufacturing costs per unit are direct materials $5, direct labor $6, and overhead $8. Budgeted foxed manufacturing costs per unit for depreciation are $2 and for supervision are $1. In March 2022, the company incurs the following costs in producing 104,000 units: direct materials $540,800, direct labor $619,840, and variable overhead $837,200. Actual foxed costs were equal to budgeted foxed costs. Prepare a flexible budget report for March. (List variable costs before fixed costs) > > > Budget PRONGHORN COMPANY Manufacturing Flexible Budget Report Actual Difference Favorable Unfavorable Neither Favorable nor Unfavorable 0000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Transcribed Image Text:Pronghorn Company expects to produce 1,248,000 units of Product XX in 2022. Monthly production is expected to range
from 83,200 to 124,800 units. Budgeted variable manufacturing costs per unit are direct materials $5, direct labor $6, and overhead
$8. Budgeted fixed manufacturing costs per unit for depreciation are $2 and for supervision are $1.
In March 2022, the company incurs the following costs in producing 104,000 units: direct materials $540,800, direct labor $619,840,
and variable overhead $837,200. Actual foxed costs were equal to budgeted foxed costs.
Prepare a flexible budget report for March. (List variable costs before fixed costs)
>
Budget
PRONGHORN COMPANY
Manufacturing Flexible Budget Report
Actual
$
Difference
Favorable
Unfavorable
Neither Favorable
nor Unfavorable
1000
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