SNELLS PERFORMANCE REPORT OF THE PRODUCTION DEPARTMENT Flexible Over (under) Budget Actual Budget Net Sales $10,500,000 $10.500.000 Less: Cost of goods sold 6,300,000 6.180,000 ($120,000) Gross profit on sales $4,200,000 $4.320,000 $120,000 Less: Operating expenses Selling and promotion expense 1,071,000 1.020.000 (51,000) Building occupancy expense 417.000 420.000 3.000 Buying expense 580,500 594.000 13.500 Delivery expense 195,000 183.000 (12,000) Credit and collection expense 93,000 90,000 (3,000) Administrative expense 562,500 564.000 1.500 Operating income $1,281,000 $1,449,000 $168.000 b. Write a statement evaluating the company's performance in relation to the plan reflected in the flexible budget