16th Edition

ISBN: 9780134475998

Author: Rajan

Publisher: YUZU

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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 …

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 t…

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Textbook Question

Chapter 14, Problem 14.38P

Variance analysis, sales-mix and sales-quantity variances. Miami Infonautics, Inc., produces handheld Windows CE™-compatible organizers. Miami Infonautics markets three different handheld models: PalmPro is a souped-up version for the executive on the go, PalmCE is a consumer-oriented version, and PalmKid is a stripped-down version for the young adult market. You are Miami Infonautics’ senior vice president of marketing. The CEO has discovered that the total contribution margin came in lower than budgeted, and it is your responsibility to explain to him why actual results are different from the budget. Budgeted and actual operating data for the company’s third quarter of 2017 are as follows:

Chapter 14, Problem 14.38P, Variance analysis, sales-mix and sales-quantity variances. Miami Infonautics, Inc., produces

1. Compute the actual and budgeted contribution margins in dollars for each product and in total for the third quarter of 2017.

Required

2. Calculate the actual and budgeted sales mixes for the three products for the third quarter of 2017.
3. Calculate total sales-volume, sales-mix, and sales-quantity variances for the third quarter of 2017. (Calculate all variances in terms of contribution margins.)
4. Given that your CEO gets very angry if actual results differ from budget, you want to be well prepared for this meeting. In order to prepare, write a paragraph or two comparing actual results to budgeted amounts.

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Chapter 14, Problem 14.37P

Chapter 14, Problem 14.39P

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Chapter 14 Solutions

EBK HORNGREN'S COST ACCOUNTING

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