You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Actual Cost in March $ 20,400 $ 68,700 $ 17,800 $ 127,700 $ 69,500 Utilities Maintenance Supplies Indirect labor Depreciation During March, the company worked 18,000 machine-hours and produced 12,000 units. The company had originally planned to work 20,000 machine-hours during March. Cost Formula $16,400+ $0.11 per machine-hour $38,900 + $1.80 per machine-hour $0.90 per machine-hour Required: 1. Prepare a flexible budget for March. 2. Prepare a report showing the spending variances for March. $94,800+ $1.60 per machine-hour $67,800 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Machine-hours Prepare a flexible budget for March. (Input all amounts as positive values.) FAB Corporation Flexible Budget For the Month Ended March 31 Utilities Maintenance Supplies Indirect labor Depreciation Total
You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Actual Cost in March $ 20,400 $ 68,700 $ 17,800 $ 127,700 $ 69,500 Utilities Maintenance Supplies Indirect labor Depreciation During March, the company worked 18,000 machine-hours and produced 12,000 units. The company had originally planned to work 20,000 machine-hours during March. Cost Formula $16,400+ $0.11 per machine-hour $38,900 + $1.80 per machine-hour $0.90 per machine-hour Required: 1. Prepare a flexible budget for March. 2. Prepare a report showing the spending variances for March. $94,800+ $1.60 per machine-hour $67,800 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Machine-hours Prepare a flexible budget for March. (Input all amounts as positive values.) FAB Corporation Flexible Budget For the Month Ended March 31 Utilities Maintenance Supplies Indirect labor Depreciation Total
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has
asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing
overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be
an excellent first step in overhead planning and control.
After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March:
Actual Cost in
March
$ 20,400
$ 68,700
$ 17,800
$ 127,700
$ 69,500
Utilities
Maintenance
Supplies
Indirect labor
Depreciation
During March, the company worked 18,000 machine-hours and produced 12,000 units. The company had originally planned to work
20,000 machine-hours during March.
Cost Formula
$16,400+ $0.11 per machine-hour
$38,900 + $1.80 per machine-hour
$0.90 per machine-hour
Required:
1. Prepare a flexible budget for March.
2. Prepare a report showing the spending variances for March.
$94,800+ $1.60 per machine-hour
$67,800
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Machine-hours
Prepare a flexible budget for March. (Input all amounts as positive values.)
FAB Corporation
Flexible Budget
For the Month Ended March 31
Utilities
Maintenance
Supplies
Indirect labor
Depreciation
Total
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