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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, 2012

Difference

Budget

Actual

Favorable F Unfavorable U Neither Favorable nor Unfavorable N

Sales in units

7,500

9,800

3,500

F

Variable expenses

Sales commissions

$1,800

$3,080

$1,280

U

Advertising expense

1,050

990

60

F

Travel expense

3,300

4,950

1,650

U

Free samples given out

1,275

1,540

265

U

Total variable

7,425

10,560

3,135

U

Fixed expenses

Rent

1,600

1,600

0

N

Sales salaries

1,100

1,100

0

N

Office salaries

900

900

0

N

Depreciation - autos (sales staff)

600

600

0

N

Total fixed

4,200

4,200

0

N

Total expenses

$11,344

$12,520

$3,135

U

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. Do not leave any answer field blank. Enter 0 for amounts.)

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