Suppose that for the next year a particular Zing Coffee store budgeted revenuw of $319,000.00, a 10% increase over the current revenue of $290,000. Zing Coffee prepared a plan that included six new budgeted products and a total advertising budget of $29,000. Actual results were as follows:

New products added 7

Advertising $31,900

Revenues $316,000

Requirements:

1. Prepare a performance report for revenus and advertisingt costs.

2. Suppose the remaining cost elements of net income were not available until several months after the store implemented the plan.

The new income results were dissapointing to management- profits delcined even though revenues increased because costs increased by more than revenues. List some factors that might have caused costs to increase so much and that management may not have considered when it formulated the store's plan.