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SILVER Sdn. Bhd. manufactures a single product, 13. The activity levels in the Assembly department vary every month. The company has prepared two provisional budgets for the quarter ended 31" March 2021. These two budgets are shown below: Provisional budgets for the quarter ended 31" March 2021: Activity level (units) 6,000 7,500 RM RM Materials 69,000 86,250 Labour 38,000 42,500 Power and maintenance 16,200 18,000 Depreciation and other fixed overheads 35,000 35,000 Total cost 158.200 181.750 After the preparation of the above two budgets, further forecasts have indicated that an activity level of 6,000 units is likely to be achieved in the next quarter. Actual results for the quarter ended 31" March 2021: Activity level 5.900 RM Materials 68,000 Direct and indirect labour 36,000 Power and maintenance 16,200 Depreciation and other fixed overheads 35,000 Total cost 155,200 Required: (a) Using the two provisional budgets provided, analyse the cost behaviour of all the costs items shown above into variable costs, fixed costs and semi-variable costs, (2 marks) (b) Calculate the following costs: (i) Variable cost per unit; (3 marks) (ii) Fixed cost per quarter. (3 marks) (c) Prepare a variance analysis for the quarter ended 31" March 2021 using the flexible budgeting method. (7 marks) (d) Explain ONE (1) possible cause for each variance identified at part (c) above. (8 marks) (e) Explain ONE (1) situation in which the incremental budget is suitable for use in a local telecommunication company. (2 marks) [Total: 25 marks]