Oly Outdoor Furniture manufactures cedar Adirondack chairs for sale at farmers markets and nurseries. The...
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Accounting
Oly Outdoor Furniture manufactures cedar Adirondack chairs for sale at farmers markets and nurseries. The company uses flexible budgeting techniques to deal with the seasonal and cyclical nature of the business. The accounting department provided the following data on budgeted manufacturing costs for the month of January:
Prepare a report comparing the actual operating results with the flexible budget for the actual level of production. Identify the potential problem areas
Actual Operations for January \begin{tabular}{lr} \hline Actual production (in units) & \multicolumn{1}{c}{15,400} \\ Actual costs incurred & \\ Direct materials & $142,400 \\ Direct labor & 259,800 \\ Indirect labor & 12,200 \\ Indirect materials & 9,800 \\ Maintenance & 28,000 \\ Supervision & 83,500 \\ Other costs (depreciation, taxes, etc.) & $563,600 \\ Total plant costs & \end{tabular} Planned Level of Production for January
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