Determine the following:Cost price varianceTotal gross profit variancePrice variance The income statement of GMA Company for the yearsendedDecember 31, 2020 and 2021 showed the following data.20202021Net Sales800,000924,000Cost of SalesGross Margin480,000320,000180,000140,000501,600422,400Operating expenses220,000202,400Net incomeAdditional Data:Units sold80,00088,000Unit selling price10.0010.50Unit cost6.005.70

Name: Determine the following:Cost price varianceTotal gross profit variance
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: Determine the following:Cost price varianceTotal gross profit variancePrice variance The income statement of GMA Company for the yearsendedDecember 31, 2020 and 2021 showed the following data.20202021Net Sales800,000924,000Cost of SalesGross Margin48

Variance is calculated for checking the difference in data of two years is favourable or…

Answered: The income statement of GMA Company for…

Business

Accounting

The income statement of GMA Company for the years ended December 31 2020 and 2021 showed the following data

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 2MC: The following information is available for Cooke Company for the current year: The gross margin is...

See similar textbooks

Related questions

Q: Define sales volume variance.

A: Sales volume variance (also known as sales quantity variance) occurs when the actual quantity of…

Q: Vargross Company presented the following data for analysis affecting its gross profit. The company…

A: Variance: A cost variance is the difference between the amount of cost that was actually incurred…

Q: Type of Variance Amount Analysis Sales Price Variance 4,000 Favorable Cost Volume Variance, 4-way…

A: Cost volume variance when arises when actual cost is not same as standard cost. When actual cost is…

Q: Jungkook Company present the following data for analysis affecting its Gross Profit. The company is…

A: Since we answer only up to three sub-parts, we shall answer the first three. Please resubmit a new…

Q: The Income Statement of ZZZ Company for the years ended December 31, 2020 and 2021 showed the…

A: SOLUTION 1-PRICE VARIANCE = (SELLING PRICE 2021 - SELLING PRICE 2020) * UNIT SOLD IN 2020. 2- PRICE…

Q: What is the interpretation of the direct-material price variance and the direct-material purchase…

A: Definition: Variance: Variance refers to the different levels in the actual cost incurred and…

Q: Data for National Co. is as follows: Product A 2020 10,000 2021 20,000 P15 P7.50 Product B 2020 2021…

Q: National Co. produces and sells cellular phone blaster, a gadget which explodes when activated with…

A: Cost Volume Variance is the variance between the difference of Standard Quantity and Actual quantity…

Q: Problem 5. Angel Company is a wholesaler that sells a single product at P103.40 per unit. Its cost…

A: The gross profit is the excess of sales revenue over its cost of goods sold. The variance analysis…

Q: Vargross Company presented the following data for analysis affecting its gross profit. The company…

A: SOLUTION FORMULAS 1- SALES PRICE VARIANCE = (CURRENT YEAR SELLING PRICE - LAST YEAR SELLING…

Q: me Variance F.) Total Gross Profit Variance G.) Price Variance H.) Price-Quantity Variance I.) Cost…

Q: Problem 2 The following income statement data presented by VGP Company for the years ended December…

A: SOLUTION FORMULAS 1- PRICE QUANTITY VARIANCE = (UNIT SOLD IN 2021 - UNIT SOLD IN 2020)/ RATE PER…

Q: The income statement of GMA Company for the years ended December 31, 2020 and 2021 showed the…

A: 2021 Units Sold (Actual) = 88000 2020 Units Sold (Budgeted)= 80000 Budgeted Price / Planned price…

Q: Find material price variance

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: The cost price variance is

A: Cost price variance refers to the difference between the actual cost and standard cost of units.…

Q: cost price variance

A: cost price variance is calculated as: (Actual unit cost - Standard unit cost) * Actual quantity…

Q: Bulldogs Inc. sells the following products. The following were obtained from the records: 2022 Cost…

A: Variance analysis is a financial and managerial accounting approach that compares actual performance…

Q: Problem 6. Highland Coffee Company is concerned with its gross profit negating the increase of its…

A: Gross profit variance refers to the difference between the actual gross profit and budgeted gross…

Q: Determine the following: Sales price variance Sales volume variance Sales variance Cost price…

A: Standard costing is the costing method, where standard or expected costs are used in calculating…

Q: Bulldogs Inc. has the following variances in its gross profit variance analysis repo Type of…

A: Kindly refer the image attached below for solution.

Q: The following income statement data presented by VGP Company for the years ended December 31, 2020…

Q: The Income Statement of ZZZ Company for the years ended December 31, 2020 and 2021 showed the…

A: SOLUTION FORMULAS- 1- SALES PRICE VARIANCE - (UNITS SELLING PRICE IN 2021-UNITS SELLING PRICE IN…

Q: Define product cost variances.

A: Product Cost variances occur when the standard cost is higher or lower than the actual costs They…

Q: Problem 8: The following income statement data presented by Laguna Corporation for the years ended…

A: By examining changes in a company's gross margin over a certain time period, the financial analysis…

Concept explainers

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.

Topic Video

Question

Determine the following:

Cost price variance
Total gross profit variance
Price variance

The income statement of GMA Company for the years
ended
December 31, 2020 and 2021 showed the following data.
2020
2021
Net Sales
800,000
924,000
Cost of Sales
Gross Margin
480,000
320,000
180,000
140,000
501,600
422,400
Operating expenses
220,000
202,400
Net income
Additional Data:
Units sold
80,000
88,000
Unit selling price
10.00
10.50
Unit cost
6.00
5.70

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1 Brief

VIEW

Step 2 Working

VIEW

Step 3 Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Operating data for Taylor Corporation are presented below. Using the Excel spreadsheet provided, prepare a schedule showing a vertical analysis for 2020 and 2019. 2020 2019 Sales revenue $800,000 $600,000 Cost of goods sold 520,000 408,000 Selling expenses 120,000 72,000 Administrative expenses 60,000 48,000 Income tax expense 30,000 24,000 Net income 70,000 48,000 (CGS percent. = CGS ÷ Sales rev.)
Use the given statement of comprehensive income below in answering the question. DEF Company, Income Statement 2021 2020 Sales P10,200.00 P9,600.00 Cost of Goods Sold P3,000.00 P2,600.00 Gross Profit P7,200.00 P7,000.00 Operating Expenses P2,400.00 P2,200.00 Operating Profit P4,800.00 P4,800.00 Interest Expense P900.00 P800.00 Earnings before tax P3,900.00 P4,000.00 Income Tax P1,560.00 P1,600.00 Net Profit P2,340.00 P2,400.00 How many percent of the sales is the operating expenses in 2021 and 2020? A 8.82% and 8.33% 70.59% and 72.92% 29.41% and 27.08% 23.53% and 22.92%
Use the given statement of comprehensive income below in answering the question. DEF Company, Income Statement 2021 2020 Sales P10,200.00 P9,600.00 Cost of Goods Sold P3,000.00 P2,600.00 Gross Profit P7,200.00 P7,000.00 Operating Expenses P2,400.00 P2,200.00 Operating Profit P4,800.00 P4,800.00 Interest Expense P900.00 P800.00 Earnings before tax P3,900.00 P4,000.00 Income Tax P1,560.00 P1,600.00 Net Profit P2,340.00 P2,400.00 What is the percent change of net profit? А -3.5% В 12.5% C) -12.5% -2.5%
Below is the Income Statement of Company A for 2020-2021 in KWD. 2021 2020 t of Sales Revenue 1,000,000 1,200,000 Cost of GoodsSold 500,000 660,000 Gross Profit 500,000 540,000 Marketing Expenses 70,000 120,000 Administrative Expenses 150,000 132,000 Net Income 280,000 288.000 Enter the Common Size Percents for 2021 and 2020 (1 Common Size Percents - Common Size Percents - 2021 2020 Sales Revenue Cost of Goods Sold Gross Profit Marketing Expenses Administrative Expenses Net Income
Operating data for Joshua Corporation are presented as follows: Net Sales Cost of Goods Sold Selling Expenses Administrative Expenses Income Tax Expense Net Income 2022 800,000 520,000 120,000 60,000 30,000 70,000 Instructions Prepare a schedule showing a vertical analysis for 2022 and 2021. Net Sales Cost of Goods Sold Gross Profit Selling Expenses Your Answers: FYI: Format the percent cols to one decimal place. Ex 99.9% 2022 Administrative Expenses Total Operating Expenses Income Before Income Taxes Income Tax Expense Net Income 2021 600,000 408,000 72,000 48,000 24,000 48,000 Amount 800,000 520,000 280,000 120,000 60,000 180,000 100,000 30,000 70,000 Percent 100.0% 2021 Amount Percent 600,000 100.0% 408,000 192,000 72,000 48,000 120,000 72,000 24,000 48,000
1. Prepare a comparative statements for Sunshine Co. showing an income statement for 3 year period. 2019. 2020. 2021Sale 500,000. 475,0000. 505,000Less: Cost of sales. 300,000. 210,000. 250,000Gross Profit on Sales. 200,000. 265,000 255,000Less: Operating Expenses. 120,000. 180,000. 155,000Net Income 80,000. 85,000. 100,000
A comparative income statement is given below for Rainbow Company Rainbow Company Comparative Income Statement For the Years Ended June 30, 2019, and 2018 2019 2018 Sales P 5,000,000.00 P 4,000,000.00 Less: Cost of Goods Sold 3,160,000.00 2,400,000.00 Gross Margin 1,840,000.00 P 1,600,000.00 Selling Expenses 900,000.00 700,000.00 Administrative Expenses 680,000.00 584,000.00 Total Expenses 1,580,000.00 1,284,000.00 Net Operating Income 260,000.00 P 316,000.00 Interest Expense 70,000.00 40,000.00 Net Income Before Taxes P 190,000.00 P 276,000.00 The president is concerned that net income is down in 2019 even though sales have increased during the year. The president is also concerned that administrative expenses have increased, since the company made a concerted effort during 2019 to pare "fat" out of the organization. Required: 1. Express each year's income statement in common-size percentages. Carry computations to one decimal place. 2. Comment briefly on the changes between the two…
The portion of the functional income statements of Brief Company for 2021 and 2020 are presented below: 2021 2020 Sales P890,000 P800,000 Cost of goods sold 530,000 450,000 Gross margin 360,000 350,000 Assuming that effective January of 2021 the unit cost is higher by 6 percent, calculate the change in sales due to change in volume rounded to nearest thousands. Group of answer choices P85,000 Favorable P88,000 Favorable P88,000 Unfavorable P85,000 Unfavorable
Examine the selected data over the 5-year period as shown in the table below for Dumbledore Ltd. Item Sales Cost of sales EBIT Interest NPAT Current assets Total assets current liabilities Total liabilities Equity Gross margin Interest coverage Current ratio 2021 $m 286.41 180.03 51.18 37.07 35.13 43.85 226.18 55.99 98.99 127.19 0.37 1.38 0.78 Year 2020 $m 280.80 166.69 51.08 33.70 35.10 43.20 221.75 53.58 91.66 130.09 0.41 1.52 0.81 2019 $m 275.29 154.35 50.98 30.64 35.06 42.56 217.40 51.27 84.87 132.53 0.44 1.66 0.89 2018 $m 269.89 142.91 50.88 27.85 35.03 41.93 213.13 49.06 78.58 134.56 0.47 1.83 U.OJ 2017 $m 264.60 134.19 49.88 25.32 34.51 41.31 206.93 47.40 74.48 132.44 0.49 1.97 0.87 2016 $m 252.00 126.00 48.90 24.00 34.00 40.70 200.90 45.80 70.60 130.30 0.50 2.04 0.89
Prepare the Pro-Forma Statement of Financial Position for the year ending 31 December 2023 INFORMATIONSibiya ProjectsStatement of Comprehensive Income for the year ended 31 December 2022 RSales 10 000 000Cost of sales (5 750 000)Gross profit 4 250 000Variable, selling and administrative costs (1 500 000)Fixed selling and administrative costs (500 000)Net profit 2 250 000 Statement of Financial Position for the year ended 31 December 2022ASSETS RNon-current assets 800 000Property, plant and equipment 800 000 Current assets 3 400 000Inventories 1 600 000Accounts receivable 600 000Cash 1 200 000TOTAL ASSETS 4 200 000 EQUITY AND LIABILITIESEquity 3 760 000 Current liabilities 440 000Accounts payable 440 000TOTAL ASSETS AND LIABILITIES 4 200 000 Additional informationA. The sales budget for 2023 is as follows:First Quarter Second Quarter Third Quarter Fourth QuarterR2 625 000 R2 750 000 R2 875 000 R2 750 000 B. 90% of sales is collected in the quarter of the sale and 10% in the quarter…
II. Direction: The following comparative financial statements are provided by Zeus Company. Using Horizontal and Vertical approach, calculate the missing and write your answer on the blank. Show supporting solutions in a separate sheet of paper. Answer the questions at the bottom of this activity.
salamagundi, inc. has the following income statement: For the year ended December 31, 2021 net sales: $160 Cost of goods sold: $100 gross profit: $60 Operating expenses: $40 Net income: $20 Using vertical analysis, what percentage is assigned to operating expenses? a. 25% b. 40% c. 66.7% d. 200%