As sales manager, Joe Batista was given the following static budget report for selling expenses in the Clothing Department of Soria Company for the month of October.

As a result of this budget report, Joe was called into the presidents office and congratulated on his fine sales performance. He was reprimanded, however, for allowing his costs to get out of control. Joe knew something was wrong with the performance report that he had been given. However, he was not sure what to do, and comes to you for advice. Prepare a budget report based on flexible budget data to help Joe. (List variable costs before fixed costs.)

SORIA COMPANY Clothing Department Budget Report For the Month Ended October 31, 2020 Difference Favorable Unfavorable Neither Favorable Budget Actual nor Unfavorable 7,900 11,000 3,100 Favorable Sales in units Variable expenses Sales commissions $2,054 $2,860 $806 Unfavorable Advertising expense 869 770 99 Favorable Travel expense 3,476 4,950 1,474 Unfavorable Free samples given out 1,659 1,210 449 Favorable Total variable 8,058 9,790 1,732 Unfavorable Fixed expenses Rent 1,900 1,900 -O- Neither Favorable nor Unfavorable Sales salaries 1,100 1,100 -0- Neither Favorable nor Unfavorable Office salaries 800 800 -O- Neither Favorable nor Unfavorable Depreciation-autos (sales staff) 600 600 -- Neither Favorable nor Unfavorable Total fixed 4,400 4,400 -- Neither Favorable nor Unfavorable Total expenses $12,458 $14,190 $1,732 Unfavorable Unfavorable Neither Favorable nor Unfavorable Budget Actual