"Unable to preview the report, install the Business Intelligence Development Studio feature of Microsoft SQL Server. For more information, see http://go.microsoft.com/fwlink/?LinkId=212331”
-> Axapta 2012 needs to integrate with Visual Studio 2010.
-> Therefore you have to install BIDS (Business Intelligence Development Studio).
->You can use a SQL Server 2008 R2 installation image to install it (it’s one of the components you can select during installation of “A new standalone server or additional components” on the client machine.
After the installation open report in visual studio - 2010.