Static-budget total contribution margin Budgeted units to be sold of all glasses Budgeted contribution margin per unit of Plain Budgeted contribution margin per unit of Chic Total sales-quantity variance Actual sales-mix percentage of Plain $15,525 2,300 units $5 per unit $12 per unit $2,700 U 60% All variances are computed in contribution-margin terms. Calculate the sales-quantity variances for each product for June 2017. Calculate the individual-product and total sales-mix variances for June 2017. Calculate the individual- product and total sales-volume variances for June 2017. Briefly describe the conclusions you can draw from the variances. 1. Required 2. 3.

Static-budget total contribution margin Budgeted units to be sold of all glasses Budgeted contribution margin per unit of Plain Budgeted contribution margin per unit of Chic Total sales-quantity variance Actual sales-mix percentage of Plain $15,525 2,300 units $5 per unit $12 per unit $2,700 U 60% All variances are computed in contribution-margin terms. Calculate the sales-quantity variances for each product for June 2017. Calculate the individual-product and total sales-mix variances for June 2017. Calculate the individual- product and total sales-volume variances for June 2017. Briefly describe the conclusions you can draw from the variances. 1. Required 2. 3.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

Variance analysis, working backward. The Hiro Corporation sells two brands of wine glasses: Plain and Chic. Hiro provides the following information for sales in the month of June 2017:

Static-budget total contribution margin
Budgeted units to be sold of all glasses
Budgeted contribution margin per unit of Plain
Budgeted contribution margin per unit of Chic
Total sales-quantity variance
Actual sales-mix percentage of Plain
$15,525
2,300 units
$5 per unit
$12 per unit
$2,700 U
60%
All variances are computed in contribution-margin terms.
Calculate the sales-quantity variances for each product for June 2017.
Calculate the individual-product and total sales-mix variances for June 2017. Calculate the individual-
product and total sales-volume variances for June 2017.
Briefly describe the conclusions you can draw from the variances.
1.
Required
2.
3.

Definition Definition Analysis of a difference between planned and actual behavior. After analyzing differences, companies find the reasons for variance so that the necessary steps should be taken to correct that variance.

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