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13 February, 03:31

Chubbs Inc.'s manufacturing overhead budget for the first quarter of 2017 contained the following data.

Variable Costs Fixed Costs

Indirect materials $11,100 Supervisory salaries $36,700

Indirect labor 11,000 Depreciation 6,100

Utilities 7,700 Property taxes and insurance 7,400

Maintenance 5,500 Maintenance 4,900

Actual variable costs were indirect materials $14,900, indirect labor $9,600, utilities $9,100, and maintenance $4,800. Actual fixed costs equaled budgeted costs except for property taxes and insurance, which were $8,500. The actual activity level equaled the budgeted level.

Required:

a. Prepare a manufacturing overhead flexible budget report for the first quarter.

b. Prepare a responsibility report for the first quarter.

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  1. 13 February, 05:27
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    a. Manufacturing overhead Flexible budget report

    Budget Actual Favorable (Unfavorable)

    Variable cost

    Indirect material $11,100 $14,900 $3,800 U

    Indirect labor $11,000 $9,600 $1,400 F

    Utilities $7,700 $9,100 $1,400 U

    Maintenance $5,500 $4,800 $700 F

    Total Variable cost $35,300 $38,400 $3,100 U

    Fixed expenses

    Supervisory Salary $36,700 $36,700 0

    Depreciation $6,100 $6,100 0

    Property, taxes $7,400 $8,500 $1,100 U

    Maintenance $4,900 $4,900 0 U

    Total fixed expense $55,100 $56,200 $1,100 U

    Total controllable

    cost $90,400 $94,600 $4,200 U

    b. Manufacturing overhead Responsibility report

    Controllable cost Budget Actual Favorable (Unfavorable)

    Indirect material $11,100 $14,900 $3,800 U

    Indirect labor $11,000 $9,600 $1,400 F

    Utilities $7,700 $9,100 $1,400 U

    Maintenance $10,400 $9,700 $700 F

    Supervisory salaries$36,700 $36,700 0

    Total $76,900 $80,000 $3,100 U
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