Assignment #$5$ Chapter $11$

Question $21$ of $21$

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As sales manager, Karen White was given the following static budget report for selling expenses in the clothing department of Crane Compary for the month of October.

$\backslash$table$[[\backslash$table$[[$CRANE COMPANY$],[$Clothing Department$],[$Budget Report$]]],[,,,$Difference$],[,$Budget,Actual,,$\backslash$table$[[$Favourable$],[$Unfavourable$],[$Neither Favourable$],[$nor Unfavourable$]]],[$Sales in units,$7,500,11,000,3,500,$Favourable$],[$Variable costs$],[$Sales commissions,$$1,950,$$$3,080,$$$1,130,$Unfavourable$],[$Advertising expense,$825,990,165,$Unfavourable$],[$Travel expense,$3,300,3,850,550,$Unfavourable$],[$Free samples given out,$1,650,1\mathrm{.}210,440,$Favourable$],[$Total variable costs,$7\mathrm{.}725,9,130,1,405,$Unfavourable$],[$Fixed costs$],[$Rent$,1,700,1,700,-0-,$Neither Favourable nor Unfavourable$],[$Sales salaries,$1,100,1,100,-0-,$Neither Favourable nor Unfavourable$],[$Office salaries,$800,800,-0-,$Neither Favourable nor Unfavourable$],[$Depreciation$-$vehicles $($sales staff$),600,600,-0-,$Neither Favourable nor Unfavourable$],[$Total fixed costs,$4,200,4\mathrm{.}200,-0-,$Neither Favourable nor Unfavourable$],[$Total costs,$$11,925,$$$13,330,$$$1,405,$Unfavourable$]]$

As a result of this budget report, Karen was called into the president's office and congratulated on her fine sales performance. She was reprimanded, however, for allowing her costs to get out of control. Kajsa knew something was wrong with the performance report that she had been given. However, she was not sure what to do and has come to you for advice

$($a$)$ Prepare a budget report based on flexible budget data to help Karen. $($List variable costs before fixed costs.$)$

$($b$)$ Should Karen have been reprimanded?

Karen $$ have been reprimanded.

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