Question

^{Fey Company's organization chart includes the president; the vice president of production; three assembly plants-Dallas, Atlanta, and Tucson; and two departments within each plant-Machining and Finishing. Budget and actual manufacturing cost data for July 2017 are as follows. Finishing Department-Dallas: direct materials $44,630 actual, $47,100 budget; direct labor $84,360 actual, $83,260 budget; manufacturing overhead $52,400 actual, $51,720 budget. Machining Department-Dallas: total manufacturing costs $223,350 actual, $218,600 budget. Atlanta Plant: total manufacturing costs $422,140 actual, $420,720 budget. Tucson Plant: total manufacturing costs $494,450 actual, $496,030 budget. The Dallas plant manager's office costs were $96,750 actual and $94,290 budget. The vice president of production's office costs were $132,960 actual and $131,200 budget. Office costs are not allocated to departments and plants.}

Answer 1

To Dallas Department
Manager-Finishing
						Favorable
						Unfavorable
						Neither Favorable
Controllable Costs:		Budget		Actual		nor Unfavorable
Direct Materials	$	47,100	$	44,630	$	2,470	Favorable
Direct Labor	$	83,260	$	84,360	$	-1,100	Unfavorable
Manufacturing Overhead	$	51,720	$	52,400	$	-680	Unfavorable
Total	$	182,080	$	181,390	$	690	Favorable
Notes:
1. Actual material cost is less than budgeted material cost, so Favorable Variance.
2. Actual direct labor cost is more than budgeted direct labor cost, so Unfavorable Variance.
3. Actual MOH cost is more than Budgeted MOH cost, so Unfavorable Variance.
4. Total actual manufacturing costs is less than total budgeted manufacturing cost, so
Favorable Variance.
MOH = Manufacturing Overheads