A company has recently introduced a system of budgetary control. Workers have given the following reasons for materials costs being more than budgeted.
1. Budgeted material costs are incorrect.
2. Production machinery is outdated and wastes materials.
3. The company should purchase better quality materials to reduce wastage.
Which reasons will cause actual material costs to be different from the budgeted costs?
1, 2 and 3
2 )
1 and 2 only
3 )
1 and 3 only
4 )
2 and 3 only
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