For Year Ended December 31 Contribution Margin Income Statement Sales (90,000 units). Variable costs Direct materials Direct labor Variable overhead i Contribution margin Fixed costs Buon margin income statement TORC Fixed overhead Fixed general and administrative Income Per Unit $ 60.00 30.00 9.00 10.00 11.00 3.00 2.00 $6.00 Annual Total $5,400,000 2,700,000 810,000 900,000 990,000 270,000 180,000 $ 540,000 A potential customer offers to buy 11,000 units for $50.00 each. These sales would not affect the company's

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Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.