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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

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 units

7,500

11,000

3,500

Favorable
Variable expenses
Sales commissions

$1,800

$3,080

$1,280

Unfavorable
Advertising expense

1,050

990

60

Favorable
Travel expense

3,300

4,950

1,650

Unfavorable
Free samples given out

1,275

1,540

265

Unfavorable
Total variable

7,425

10,560

3,135

Unfavorable
Fixed expenses
Rent

1,600

1,600

0

Neither Favorable nor Unfavorable
Sales salaries

1,100

1,100

0

Neither Favorable nor Unfavorable
Office salaries

900

900

0

Neither Favorable nor Unfavorable
Depreciationautos (sales staff)

600

600

0

Neither Favorable nor Unfavorable
Total fixed

4,200

4,200

0

Neither Favorable nor Unfavorable
Total expenses

$11,625

$14,760

$3,135

Unfavorable

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.)

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