91影视

The production supervisor of the Machining Department for Nell Company agreed to the following monthly static budget for the upcoming year: Nell Company Machining Department Monthly Production Budget Wages . . . . . . . . . . . . . . . . . . . . . . \(540,000 Utilities . . . . . . . . . . . . . . . . . . . . . . 36,000 Depreciation . . . . . . . . . . . . . . . . . . 60,000 ________ Total . . . . . . . . . . . . . . . . . . . . . . \)636,000 ________ ________ The actual amount spent and the actual units produced in the first three months of 2010 in the Machining Department were as follows: Amount Spent Units Produced January \(600,000 110,000 February 570,000 100,000 March 545,000 90,000 The Machining Department supervisor has been very pleased with this performance, since actual expenditures have been less than the monthly budget. However, the plant manager believes that the budget should not remain fixed for every month but should 鈥渇lex鈥� or adjust to the volume of work that is produced in the Machining Department. Additional budget information for the Machining Department is as follows: Wages per hour \)18.00 Utility cost per direct labor hour $1.20 Direct labor hours per unit 0.25 Planned unit production 120,000 a. Prepare a flexible budget for the actual units produced for January, February, and March in the Machining Department. Assume depreciation is a fixed cost. b. Compare the flexible budget with the actual expenditures for the first three months. What does this comparison suggest?