Required a. Using variances; identify and prepare an explanation of the difference between the budgeted profit based on standard costs, and the actual profit for the month of October 2022. b. Briefly comment on the possible causes of the variances which you have calculated c. Describe the kinds of information that are useful in setting cost standards and the conditions that must be present to support the use of standard costing. Kerry Ltd manufactures and sell household item. The market is competitive and they advertise in their brochure that they produce item available at just 1.25kg, thereby hoping to attract a wide range of customers. Each month the company attempts to produce an amount equal to expected sales orders as to minimize the need for costly warehouse space. They adopted a standard costing system and the following monthly budget was prepared at the beginning of 2022 to apply throughout the year. Variable overhead are based on direct labour hours. Further information Budgeted direct materials to be consumed per month were set as follows: Fabric Screw 10,125kg6,750kg Budgeted direct labour hours per month were set at 5,400 hours The following report relates to the actual performance for October 2022