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The Mixing Department manager of Crede Company is able to control all overhead costs except rent, property taxes, and salaries. Budgeted monthly overhead costs for the Mixing Department, in alphabetical order, are:
Indirect labor $12,000
Property taxes 93 1,000
Indirect materials 7,500
Rent 1,800
Lubricants 1,700
Salaries 10,000
Maintenance 3,500
Utilities 5,000
Actual costs incurred for January 2010 are indirect labor $12,200;
indirect materials $10,200;
lubricants $1,650;
maintenance $3,500;
property taxes $1,100;
rent $1,800;
salaries $10,000; and
utilities $6,500.
Instructions
Question (a) Prepare a responsibility report for January 2010.
Question (b) What would be the likely result of management's analysis of the report?
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