Sales Variances; Quarter to Quarter Hathaway Products Inc. produces an innovative lighting system used in restaurants and high-end retail stores to provide a pleasing, warm atmosphere.Hathaway produces two versions of the product, called Starlight and Moonlight. Sales managementat Hathaway wants to complete a sales performance analysis and has collected the following information for the first quarter (Qtr. 1) and the second quarter (Qtr. 2) of the current fiscal year:Qtr. 2 Qtr. 1Sales units 12,000 10,000Sales mix for each productStarlight 20% 25%Moonlight 80% 75%PriceStarlight $35.00 $35.00Moonlight $85.00 $90.00Variable cost per unitStarlight $22.00 $22.00Moonlight $48.00 $48.00Fixed cost $150,000 $150,000[LO 16-3][LO 16-4]Final PDF to printerChapter 16 Operational Performance Measurement: Further Analysis of Productivity and Sales 701blo17029_ch16_671-712.indd 701 02/20/18 09:50 AMRequired1. Prepare a flexible-budget contribution income statement for Qtr. 2, showing the Qtr. 2 results, the Qtr. 1results, and the flexible budget. Use Exhibit 16.15 as a guide.2. Calculate the sales volume variance for each product based both on sales dollars and contributionmargin.3. Determine the sales mix variance, and the sales quantity variance for each product, based on contribution margin.
Sales Variances; Quarter to Quarter Hathaway Products Inc. produces an innovative lighting system used in restaurants and high-end retail stores to provide a pleasing, warm atmosphere.
Hathaway produces two versions of the product, called Starlight and Moonlight. Sales management
at Hathaway wants to complete a sales performance analysis and has collected the following information for the first quarter (Qtr. 1) and the second quarter (Qtr. 2) of the current fiscal year:
Qtr. 2 Qtr. 1
Sales units 12,000 10,000
Sales mix for each product
Starlight 20% 25%
Moonlight 80% 75%
Price
Starlight $35.00 $35.00
Moonlight $85.00 $90.00
Variable cost per unit
Starlight $22.00 $22.00
Moonlight $48.00 $48.00
Fixed cost $150,000 $150,000
[LO 16-3]
[LO 16-4]
Final PDF to printer
Chapter 16 Operational Performance Measurement: Further Analysis of Productivity and Sales 701
blo17029_ch16_671-712.indd 701 02/20/18 09:50 AM
Required
1. Prepare a flexible-
results, and the flexible budget. Use Exhibit 16.15 as a guide.
2. Calculate the sales volume variance for each product based both on sales dollars and contribution
margin.
3. Determine the sales mix variance, and the sales quantity variance for each product, based on contribution margin.
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