Requirements 1. Prepare flexible budget income statements for the company, showing output levels of 65,000, 70,000, and 75,000 kits. 2. Graph the behavior of the company's total costs. Use total costs on the y-axis and volume (in thousands of bubble kits) on the x-axis. 3. Why might Creative Bubbles' managers want to see the graph you prepared in Requirement 2 as well as the columnar format analysis in Requirement 1? What is the disadvantage of the graphic approach? 0 Creative Bubbles, Inc., produces multicolored bubble solution used for weddings and other events. (Click the icon to view the master budget income statement.) Creative Bubbles' plant capacity is 72,500 kits. If actual volume exceeds 72,500 kits, the company must expand the plant. In that case, salaries will increase by 10%, depreciation by 15%, and rent by $6,000. Fixed utilities will be unchanged by any volume increase. Requ 1. Pr the 70 2. Gr CO Vol the 3. WH see as Re the Sales revenue Variable expenses: Cost of goods sold Sales commissions Creative Bubbles, Inc. Flexible Budget Income Statement Month Ended October 31 Flexible Budget per Output Unit 65,000 Output Units (Kits) 70,000 75,000 Sales revenue Variable expenses: Cost of goods sold Sales commissions Utility expense Fixed expenses: Salary expense Depreciation expense Rent expense Utility expense Total expenses Operating income