Johnston Company (JC) sells two types of bicycles with details as follows for 2019: Plan Expected total industry unit sales Budgeted JC unit sales Budgeted selling price per unit Budgeted variable costs per unit Actuals Actual total industry unit sales Actual JC unit sales Actual selling price per unit Actual variable cost per unit Required: Mountain Road 96,000 170,000 8,400 34,000 $ 1,200 $ 1,600 $ 968 $ 1,258 200,000 120,000 12,000 36,000 $ 1,240 $ 1,575 1,000 $ 1,275 $ 1. Calculate the budgeted contribution margin for each model. Budgeted Contribution Margin Mountain Road Selling price $ 1,200 $ 1,600 Variable costs 968 1,258 Budgeted contribution margin per unit $ 232 $ 342 2. Calculate the following variances: a. Sales Price Variance $ 420,000 U b. Market Volume Variance F C. Market Share Variance U d. Sales Mix Variance e. Sales Quantity Variance

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Johnston Company (JC) sells two types of bicycles with details as follows for 2019:
Plan
Expected total industry unit sales
Budgeted JC unit sales
Budgeted selling price per unit
Budgeted variable costs per unit
Actuals
Actual total industry unit sales
Actual JC unit sales
Actual selling price per unit
Actual variable cost per unit
Required:
Mountain
Road
96,000
170,000
8,400
34,000
$ 1,200 $ 1,600
$
968 $
1,258
200,000
120,000
12,000 36,000
$ 1,240 $ 1,575
1,000 $ 1,275
$
1. Calculate the budgeted contribution margin for each model.
Budgeted Contribution Margin
Mountain
Road
Selling price
$
1,200 $
1,600
Variable costs
968
1,258
Budgeted contribution margin per unit
$
232 $
342
2. Calculate the following variances:
a.
Sales Price Variance
$
420,000 U
b.
Market Volume Variance
F
C.
Market Share Variance
U
d.
Sales Mix Variance
e.
Sales Quantity Variance
Transcribed Image Text:Johnston Company (JC) sells two types of bicycles with details as follows for 2019: Plan Expected total industry unit sales Budgeted JC unit sales Budgeted selling price per unit Budgeted variable costs per unit Actuals Actual total industry unit sales Actual JC unit sales Actual selling price per unit Actual variable cost per unit Required: Mountain Road 96,000 170,000 8,400 34,000 $ 1,200 $ 1,600 $ 968 $ 1,258 200,000 120,000 12,000 36,000 $ 1,240 $ 1,575 1,000 $ 1,275 $ 1. Calculate the budgeted contribution margin for each model. Budgeted Contribution Margin Mountain Road Selling price $ 1,200 $ 1,600 Variable costs 968 1,258 Budgeted contribution margin per unit $ 232 $ 342 2. Calculate the following variances: a. Sales Price Variance $ 420,000 U b. Market Volume Variance F C. Market Share Variance U d. Sales Mix Variance e. Sales Quantity Variance
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