Snowflake Manufacturing Company manufactures motors for various small engines. The founder and President uses budgets in controlling costs. The company's production manager based the monthly budget amounts in his reports on an expected production of 60,000 units per month or 720,000 units per year. The assembling department manager is pleased with the report and expects a raise. The company President, however, is unhappy with the results for August, because only 58,000 units were produced. The August 2021 budget report for the company's assembling department is as follows: Budget Actual Manufacturing Costs Variable Costs Direct materials Direct labour Indirect materials Indirect labour Utilities Maintenance Total Variable costs Fixed Costs Rent Supervision Depreciation Total Fixed costs $48,000 54,000 24,000 18,000 15,000 9,000 168,000 $47,000 51,300 24,200 17,500 14,900 9,200 164,100 12,000 17,000 7,000 36,000 12,000 18,000 7,000 37,000 Total Costs $204,000 $201,100 The President has heard about static and flexible budgets but is unsure what the differences are, and which one is best for Snowflake Manufacturing. He has asked you, his newly hired accountant, to prepare a brief memo for him that addresses these issues. What he would like you to do is to prepare the static budget variance and the flexible budget variance. Once you have prepared these, he has asked you to analyze the results to see how the month of August really was. He knows that several of his managers could use some assistance in budgeting. So, in addition to the above, he would like you include in the report a section of the benefits and pitfalls of budgeting and how budgets can be used appropriately at Snowflake Company. Required Prepare the report