Problem 10-6A (Part Level Submission) Manufacturing Overhead Actual Budget $73,3

Question

Problem 10-6A (Part Level Submission)

Manufacturing Overhead

Actual

Budget

$73,300

$69,700

48,000

46,000

20,800

17,900

20,500

16,600

22,500

19,800

$185,100

$170,000

Vice President

Actual

Budget

(a1)

To Cutting Department Manager—Seattle Division

Month: January

Controllable Costs:

Budget

Actual

Favorable
Unfavorable
Neither Favorable
nor Unfavorable

            Total

LINK TO TEXT

(a2)

To Division Production Manager—Seattle

Month: January

Controllable Costs:

Budget

Actual

Favorable
Unfavorable
Neither Favorable
nor Unfavorable

            Total

** I need help with the percentages

Problem 10-6A (Part Level Submission)

Durham Company uses a responsibility reporting system. It has divisions in Denver, Seattle, and San Diego. Each division has three production departments: Cutting, Shaping, and Finishing. The responsibility for each department rests with a manager who reports to the division production manager. Each division manager reports to the vice president of production. There are also vice presidents for marketing and finance. All vice presidents report to the president.

In January 2017, controllable actual and budget manufacturing overhead cost data for the departments and divisions were as shown below.

Manufacturing Overhead

Actual

Budget

Individual costs—Cutting Department—Seattle     Indirect labor

$73,300

$69,700

    Indirect materials

48,000

46,000

    Maintenance

20,800

17,900

    Utilities

20,500

16,600

    Supervision

22,500

19,800

$185,100

$170,000

Total costs     Shaping Department—Seattle $158,400 $148,200     Finishing Department—Seattle 210,700 204,100     Denver division 678,400 672,800     San Diego division 722,100 715,100
Additional overhead costs were incurred as follows: Seattle division production manager—actual costs $52,900, budget $50,600; vice president of production—actual costs $65,100, budget $63,700; president—actual costs $76,700, budget $74,300. These expenses are not allocated.

The vice presidents who report to the president, other than the vice president of production, had the following expenses.

Vice President

Actual

Budget

Marketing $133,400 $129,600 Finance 108,700 105,000

Explanation / Answer

Responsibility Report Manufacturing Overhead To Cutting Dept Manager -Seattle Division Controllable costs Actual Budget Variance Favorable/Unfavorable/Neither Favorable Nor Unfavorable Indirect Labor                  73,300                69,700                  3,600 Unfavorable Indirect Materials                  48,000                46,000                  2,000 Unfavorable Maintenance                    20,800                17,900                  2,900 Unfavorable Utilities                  20,500                16,600                  3,900 Unfavorable Supervision                  22,500                19,800                  2,700 Unfavorable Total                185,100             170,000                15,100 Unfavorable Responsibility Report Manufacturing Overhead To Division Manager -Seattle Division Controllable costs Actual Budget Variance Favorable/Unfavorable/Neither Favorable Nor Unfavorable Cutting Department Seattle                185,100             170,000                15,100 Unfavorable Shaping Department Seattle                158,400             148,200                10,200 Unfavorable Finishing Department Seattle                210,700             204,100                  6,600 Unfavorable Total                  554,200             522,300                31,900 Unfavorable

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