Abracadabra Cleaning Supplies (Abracadabra) manufactures wooden brooms, aluminum washing wands, and a special magic cleaner. Tania, the owner, is looking over the results of the previous years sales of the companys cleaning products. The following is a report of budgeted and actual performance. Budget Actual Revenues $26,730 $34,265 Raw materials 7,425 9,345 Direct labour 3,465 3,427 Variable overhead 5,445 6,542 Variable selling costs 495 623 Contribution margin $ 9,900 $14,328 Tania has also gathered the following information: Abracadabra raised the price of the special magic cleaner by $0.10 per unit. Actual units sold were 6,230. Due to a global shortage of coal, energy prices spiked in the year, increasing utility costs. Abracadabra did not budget for any marketing last year but decided part way through the year to pay for a search engine optimization service. This amount is included in the variable selling costs. Variable overhead is mostly made up of utility costs. Required: a) Prepare a horizontal variance analysis for the budgeted and actual results, including explanations for why variances may have occurred, integrating case facts for support. b) Abracadabra has always prepared its budgets using the traditional method of budgeting. Tania is considering using another method to prepare the organizations budgets. Describe how Abracadabras budgets would be prepared using zero-based budgeting and activity-based budgeting, including the advantages and disadvantages for each method.