Question:
Lawler Company expects to produce 40,000 units of product CV93 during the current year. Budgeted variable manufacturing costs per unit are direct materials $6, direct labor $15, and overhead $24. Annual budgeted fixed manufacturing overhead costs are $120,000 for depreciation and $60,000 for supervision.
In the current month, Lawler produced 5,000 units and incurred the following costs: direct materials $33,900, direct labor $74,200, variable overhead $120,500, depreciation $10,000, and supervision $5,000.
Prepare a flexible budget report. (Note: You do not have to prepare the heading.) Were costs controlled?