You have just been hired by securidoor corporation the

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Reference no: EM13570409

You have just been hired by SecuriDoor 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 April:

	Cost Formula	Actual Cost in April
Utilities	$ 16,700 plus $.13 per machine-hour	$	21,100
Maintenance	$ 38,300 plus $1.70 per machine-hour	$	66,100
Supplies	$ .70 per machine-hour	$	13,800
Indirect labor	$ 94,100 plus $1.70 per machine-hour	$	129,000
Depreciation	$ 68,300	$	70,000

During April, the company worked 18,000 machine-hours and produced 12,000 units. The company had originally planned to work 20,000 machine-hours during April.

Required:

1.	Prepare a flexible budget for April.

SecuriDoor Corporation Flexible Budget For the Month Ended April 30
Machine-hours
Utilities	$
Maintenance
Supplies
Indirect labor
Depreciation

Total	$

2.	Prepare a report showing the spending variances for April.

SecuriDoor Corporation Spending Variances For the Month Ended April 30
	Flexible Budget	Actual Results	Spending variance
Utilities	$	$	$	(Click to select)FUNone
Maintenance				(Click to select)FNoneU
Supplies				(Click to select)FUNone
Indirect labor				(Click to select)FUNone
Depreciation				(Click to select)FUNone

Total	$	$	$	(Click to select)FUNone

Reference no: EM13570409

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