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DUNHAM COMPANY Clothing Department Budget Report Month Ended October 31, 2020 Difference Favourable Unfavourable Neither Favourable nor Unfavourable Budget Actual Sales in units 8,500 11.000 2.500 Favourable Variable costs Sales commissions $2.380 $2,860 $480 Unfavourable Advertising expense 850 990 140 Unfavourable Travel expense 3,910 3.850 60 Favourable Free samples given out 1,615 1210 405 Favourable Total variable costs 8.755 8,910 155 Unfavourable Fixed costs Rent 1.700 1,700 -0- Neither Favourable nor Unfavourable 7:11PM Fixed costs Rent Sales salaries 1,700 1.700 1,000 1.000 Office salaries 600 600 -0- Neither Favourable nor Unfavourable -0- Neither Favourable nor Unfavourable -0- Neither Favourable nor Unfavourable Depreciation-vehicles (sales staff) 500 500 Total fixed costs 3,800 3,800 Total costs $12.555 $12,710 -0- Neither Favourable nor Unfavourable -0- Neither Favourable nor Unfavourable $155 Unfavourable As a result of this budget report, Kajsa 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 Kajsa. (List variable costs before fixed costs.) DUNHAM COMPANY Selling Expense Flexible Budget Report Clothing Department the Month Ended October 31, 2020 Free Samples Travel Expense Advertising Expense Sales in Units Depreciation-Sale Staff Autos Total Variable Costs Total Costs Total Fixed Costs Sales Commissions Sales Salaries Variable Costs Office Salaries Rent Fixed Costs Department For the Month Ended October 31, 2020 Budget Actual No (b) Should Kajsa have been reprimanded? Kajsa have been reprimanded. Unfavourable Neither Favourable nor Unfavourable Favourable

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