During the second quarter, Ahrens Automotive decides to leave all budget values the same as in the first quarter, which is shown below. Its direct labor costs increase to $90,650 but all other costs are identical to the first quarter costs. How will this change impact Ahrens in the second quarter?

Variable costs Direct materials ($18) Direct labor ($25) Overhead S36D Total variable costs Fixed costs Depreciation Supervision Total fixed costs Total costs Budget Actual $121,740 $120,000 $87,650 $90,000 $135,000 $135,000 344,390 $345,000 $18,000 $18,000 $10,000 S8,200 S28,000 $26,200 $373,000 $370,590