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. Ingredients THE AM BAKERY Bakery Sales Actual Costs For the Month Ending August 31 Flour Butter Oil Fruit Nuts Chocolate Other Total ingredients Labor Channel manager Other Utilities Rent Marketing Total bakery costs Revenues Actual Budgeted Difference $ 3,900 3,500 $ 3,700 $ 200 3,400 100 1,700 1,800 (100) 1,300 1,000 300 900 800 100 800 800 - 400 300 100 $ 12,500 $ 11,800 $ 700 $ 4,500 4500 10,700 10,900 (200) 2,400 2,300 100 3,600 200 3,600 $ 33,900 $ 52,200 100 $ 33,200 $ 52,200 100 $ 700 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 $4,500 in August to $5,000 in November. Rent, utilities, 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 $4,500 in August to $5,000 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 $ 4,950 4,600 2,030 1,550 1,200 1,030 460 Total ingredients Labor Channel manager Other $ 15,820 $ 5,000 14,120 2,400 3,600 Utilities Rent Marketing 200 Total bakery costs $ 41,140 Revenues $ 68,000 Required: INC AM DANENT Bakery Sales Actual and Budgeted Costs For the Month Ending November 30 Actual Budgeted Difference Ingredients Flour $ 4,950 Butter 4,600 Oil 2,030 Fruit 1,550 Nuts 1,200 Chocolate 1,030 Other 460 Total ingredients $ 15,820 $ 0 Labor Channel manager $ 5,000 Other 14,120 Utilities 2,400 Rent 3,600 Marketing 200 Total bakery costs $ 41,140 Revenues $ 68,000 < Required A Required B > 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 >