Assume that The AM Bakery is preparing a budget for the month ending November 30. Management prepares the budget by starting with the actual results for August that are shown below. Then, management considers what the differences in costs will be between August and November. THE AM BAKERY Bakery Sales Actual Costs Ingredients For the Month Ending August 31 Actual Budgeted Difference Flour Butter $ 3,900 3,500 $ 3,700 3,400 $ 200 100 Oil Fruit 1,700 1,800 (100) 1,300 1,000 300 Nuts 900 800 100 Chocolate Other 800 800 400 300 100 Total ingredients Labor $ 12,500 $ 11,800 $ 700 Channel manager $ 4,500 4500 Other 10,700 10,900 (200) Utilities 2,400 2,300 100 Rent Marketing 3,600 200 3,600 100 100 Total bakery costs $ 33,900 $ 33,200 $ 700 Revenues $ 52,200 $ 52,200 a. Prepare a statement that compares the budgeted and actual costs for November. b. Suppose that you have limited time to determine why actual costs are not the same as budgeted costs. Which three cost items would you investigate to see why actual and budgeted costs are different? Complete this question by entering your answers in the tabs below. Required A Required B Suppose that you have limited time to determine why actual costs are not the same as budgeted costs. Which three cost items would you investigate to see why actual and budgeted costs are different? Cost items < Required A Required B Required A Required B Prepare a statement that compares the budgeted and actual costs for November. Note: Negative amounts should be indicated by a minus sign. THE AM BAKERY Bakery Sales Actual and Budgeted Costs For the Month Ending November 30 Actual Budgeted Difference Ingredients Flour $ 5,130 $ 6,413 Butter 4,780 5,975 Oil 2,210 2,763 Fruit 1,730 2,163 Nuts 1,380 1,725 Chocolate 1,570 1,963 Other 820 1,025 Total ingredients $ 17,620 $ 22,027 Labor Channel manager 5,900 $ 6,400 $ (500) Other 14,444 18,777 Utilities 2,760 2,760 Rent 3,960 3,960 Marketing 200 200 Total bakery costs $ 44,884 Revenues $ 69,350 Management expects revenue in November to be 30 percent higher than in August, and it expects all ingredient costs (e.g., flour, butter, and so on) to be 25 percent higher in November than in August. Management expects "other" labor costs to be 30 percent higher in November than in August, partly because more labor will be required in November and partly because employees will get a pay raise. The manager will get a pay raise that will increase his salary from $5,400 in August to $5,900 in November. Rent, utilities, and marketing costs are not expected to change. Now, fast-forward to early December and assume the following actual results occurred in November. THE AM BAKERY Bakery Sales Actual Costs For the Month Ending November 30 Ingredients Flour Butter Oil Fruit Nuts Chocolate Other Actual $ 5,130 4,780 2,210 1,730 1,380 1,570 820 Total ingredients Labor Channel manager Other Utilities Rent $ 17,620 $ 5,900 14,444 2,760 3,960 Marketing 200 Total bakery costs $ 44,884 $ 69,350 Revenues Required: a. Prepare a statement that compares the budgeted and actual costs for November. b. Suppose that you have limited time to determine why actual costs are not the same as budgeted costs. Which three cost items would you investigate to see why actual and budgeted costs are different