Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department.
The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month:
Direct labor +$16.30 q
Indirect labor$4,600+$1.60 q
Utilities$5,300+$0.80 q
Supplies$1,700+$0.30 q
Equipment depreciation$18,000+$3.00 q
Factory rent$8,100
Property taxes$2,700
Factory administration$13,200+$0.70 q
The actual costs incurred in March in the Production Department are listed below:
Actual Cost Incurred in March
Direct labor$70,040
Indirect labor$10,820
Utilities$9,210
Supplies$3,230
Equipment depreciation$30,600
Factory rent$8,500
Property taxes$2,700
Factory administration$15,510
1. The company had budgeted for an activity level of 4,400 labor-hours in March.
Complete the Production Department's planning budget for the month.
Packaging Solutions Corporation
Production Department Planning Budget
For the Month Ended March 31
Direct labor
Indirect labor
Utilities Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
Total expense$ _