The portion of the functional income statements of Brief Company for 2021 and 2020 are presented below: 20212020SalesP890,000P800,000Cost of goods sold 530,000 450,000Gross 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.P85,000 UnfavorableP88,000 FavorableP88,000 UnfavorableP85,000 Favorable

Cost of goods sold if unit cost not increased for 2021 = Cost of goods sold / (1 + increased%) =…

Answered: The portion of the functional income…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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.

P85,000 Unfavorable

P88,000 Favorable

P88,000 Unfavorable

P85,000 Favorable

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