Missoula, Inc

Missoula, Inc., is looking for feedback on performance. The company compares the budget for the year with the actual costs.
Missoula, Inc., had the following budgeted data:
Unit sales for 2016 10,000
Unit production for 2016 10,000
Budgeted fixed overhead for 2016:
Supervision $18,000
Depreciation 20,000
Rent 10,000
Budgeted variable costs per unit:
Direct materials $18.00
Direct labor 25.00
Supplies 0.20
Indirect labor 1.00
Power 0.10
The following actually occurred:
Actual unit sales for 2016 11,000
Actual unit production for 2016 12,000
Actual fixed overhead for 2016:
Supervision $17,850
Depreciation 20,000
Rent 10,000
Actual variable costs for 2016:
Direct materials $214,000
Direct labor 320,000
Supplies 2,500
Indirect labor 10,000
Power 1,500
Required:
a. Prepare a performance report for all costs showing static budget variances.
b. Prepare a performance report for all costs showing flexible budget variances.

Correct Answer:

Verified

a. Actual Budget for 10,000 Variance
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