Assume that Carmen's Cookies is preparing a budget for the month ending September 30. Management prepares the budget by starting with the actual results for April that are shown below. Then, management considers what the differences in costs will be between April and September.
| CARMEN'S COOKIES Retail Responsibility Center Actual Costs For the Month Ending April 30 | |||
| Actual (April) | |||
| Food | |||
| Flour | $ | 1,600 | |
| Eggs | 5,000 | ||
| Chocolate | 1,300 | ||
| Nuts | 2,000 | ||
| Other | 1,800 | ||
| Total food | $ | 11,700 | |
| Labor | |||
| Manager | $ | 3,000 | |
| Other | 1,200 | ||
| Total labor | $ | 4,200 | |
| Utilities | 1,500 | ||
| Rent | 5,000 | ||
| Total cookie costs | $ | 22,400 | |
| Number of cookies sold | 25,000 | ||
Management expects cookie sales to be 15 percent greater in September than in April, and it expects all food costs (e.g., flour, eggs) to be 15 percent higher in September than in April because of the increase in cookie sales. Management expects “other” labor costs to be 28 percent higher in September than in April, partly because more labor will be required in September and partly because employees will get a pay raise. The manager will get a pay raise that will increase the salary from $3,000 in April to $3,300 in September. Utilities will be 3 percent higher in September than in April. Rent will be the same in September as in April. |
Now, fast forward to early October and assume the following actual results occurred in September: |
| Required: |
| a. | Prepare a statement that compares the budgeted and actual costs. (Round your final answers to nearest whole dollar. Negative amounts should be indicated by a minus sign.) |
