As sales manager, Joe Batista was given the following static budget report for selling expenses in the Clothing Department of Ayayai Company for the month of October.

AYAYAI COMPANY Clothing Department Budget Report For the Month Ended October 31, 2022
					Difference
	Budget		Actual		Favorable Unfavorable Neither Favorable nor Unfavorable
Sales in units	6,400		8,000		1,600	Favorable
Variable expenses
Sales commissions	$1,920		$2,080		$160	Unfavorable
Advertising expense	576		680		104	Unfavorable
Travel expense	2,880		3,280		400	Unfavorable
Free samples given out	1,280		1,120		160	Favorable
Total variable	6,656		7,160		504	Unfavorable
Fixed expenses
Rent	1,200		1,200		–0–	Neither Favorable nor Unfavorable
Sales salaries	960		960		–0–	Neither Favorable nor Unfavorable
Office salaries	640		640		–0–	Neither Favorable nor Unfavorable
Depreciation—autos (sales staff)	400		400		–0–	Neither Favorable nor Unfavorable
Total fixed	3,200		3,200		–0–	Neither Favorable nor Unfavorable
Total expenses	$9,856		$10,360		$504	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.

(a)

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

(b)

Should Joe have been reprimanded?
select an option YesNo

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