Question 4 {20 marks} You have been hired as a junior management accountant by Daisy and Co. which manufactures a range of small devices that help open garage doors. The senior management accountant has asked you to look at the costing system and help the business control its manufacturing overheads. Daisy and Co. have never used a flexible budget and you suggest that preparing a flexible budget will help the business in overhead planning and control. After discussions with the senior management accountant and other divisional heads, you determined the following costformula and actual cost data forthe Month ending 30 June 2022. Itern Cost formula Actual Results Supplies 0.50 per machine hour $16,800 Utilities $41,200 plus $0.10 per machine hour $48,400 Indirect labour $260,000 plus $1.40 per machine hour $299,200 Repairs and maintenance $30,000 plus $3.20 per machine hour $155,800 Depreciation of machinery $140,000 $143,000 Juring June, Daisy and co. worked 26,000 machine hours and produced 15,000 units. Daisy and Co. had originally planned to work 30,000 machine hours duringJune. Required: a! Prepare a report separately showing activity and spending variances for June 2022 and explain what could be the reasons for these variances. {10 marks: b] A manager of an online clothing seller made the following comment: ' The whole budgeting process is a waste oftime. lwould rather my managers and finance stafffocus on improving the business than spend time putting together detailed budgeting schedules'. Comment on this statement. {10 marks} [Chapter 158.1630 marks)