P10-71B PREPARE A FLEXIBLE BUDGET FOR PLANNING (Learning Objective 5) Creative Bubbles produces multicoloured bubble solution used for weddings and other events. Creative Bubbles' plant capacity is 72,500 kits. If actual volume exceeds 72,500 lats, the company must expand the plan in that case, salaries will increase by 10%, depreciation by 15%, and rent by $6,000. Foed utilities will be unchanged by any volume increase. The company's static budget income statement for December follows. It is based on expected sales volume of 65,000 bubble kits. Creative Bubbles, Inc. Statie Budget Income Statement Month Ended December 31 Sales revenus 201.500 Variable expenses Cost of goods sold 81,250 Sales commissions 13.000 Utilities expense 2.750 Food expenses: Salary expense 38.000 Depreciation expense 18.000 Rent expense 3,000 3.000 Utilities expense 107.000 Total expenses $34 500 Operating income Requirements 1. Prepare filedible budget income statements for the company, showing output levels of 65,000, 70,000, and 75,000 kts. 2. Graph the behaviour of the company's total costs. 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 17 What is the disadvantage of the graph approach