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.

SORIA COMPANY

Clothing Department

Budget Report

For the Month Ended October 31, 2020

Difference

Budget

Actual

Favorable

Unfavorable

Neither Favorable

nor Unfavorable

Sales in units7,800

10,000

2,200

FavorableVariable expensesSales commissions$1,872

$2,400

$528

UnfavorableAdvertising expense936

900

36

FavorableTravel expense3,120

4,000

880

UnfavorableFree samples given out1,794

1,300

494

FavorableTotal variable7,722

8,600

878

UnfavorableFixed expensesRent1,700

1,700

-0-

Neither Favorable nor UnfavorableSales salaries1,100

1,100

-0-

Neither Favorable nor UnfavorableOffice salaries800

800

-0-

Neither Favorable nor UnfavorableDepreciationautos (sales staff)400

400

-0-

Neither Favorable nor UnfavorableTotal fixed4,000

4,000

-0-

Neither Favorable nor UnfavorableTotal expenses$11,722

$12,600

$878

Unfavorable

As a result of this budget report, Joe was called into the president's 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.

Make a budget report based on flexible budget data to help Joe. (List variable costs before fixed costs.)

SORIA COMPANY

Selling Expense Flexible Budget Report

Clothing Department

For the Month Ended October 31, 2020