COST ACCOUNTING W/CONNECT
6th Edition
ISBN: 9781264022021
Author: LANEN
Publisher: MCG
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Textbook Question
Chapter 17, Problem 42P
Industry Volume and Market Share Variances: Missing Data
The following graph is similar to the one presented in Exhibit 17.4. Actual sales volume for the firm is below its budgeted sales volume.
Required
Find the missing amounts:
- a. Actual minus budgeted sales volume.
- b. Budgeted industry volume.
- c. Budgeted market share percent.
- d. Actual market share percent.
- e. Actual industry volume.
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Students have asked these similar questions
Which statement is true?
A. Gross profit (GP) variance analysis, is an essential part of
financial statements analysis that is used to evaluate
the performance of a firm's departments responsible
for the firm's line activities (functions).
B. Increases and decreases in sales and cost of sales have
direct relationship with increases and decreases in GP.
C. If there is a negative sales price variance and there is no
cost variance, the gross profit variance will be equal to the
sales price variance.
D. A zero cost variance indicates that there is no difference
between the standard cost prices and actual cost prices.
E. none of the above
Which of the following statements is incorrect?
a. Sales volume variance is the amount by which sales would have varied from the base sales if only the sales volume had changed.
b. Sales price variance measures the impact on the firm’s gross profit of changes in the unit selling price.
c. Cost volume variance is the amount by which cost of sales would have varied from the base cost of sales if only the units produced had changed.
d. Cost price variance measures the impact on the firm’s gross profit of changes in the unit cost price or cost of sales.
How many statements below regarding margin of safety are correct?
1. It is the amount by which sales can be reduced without incurring a loss.
2. It is the difference between budgeted sales and breakeven sales.
3. It can be expressed in terms of unit, pesos or percentage of sales.
4. Its presence indicates that the company expects profit.
5. The product of margin of safety units and unit contribution margin is the
projected profit for the period.
6. The higher the margin of safety, the lower is the risk of incurring operating loss.
3
4
Chapter 17 Solutions
COST ACCOUNTING W/CONNECT
Ch. 17 - What complication arises in variance analysis when...Ch. 17 - Variance analysis can be useful in a manufacturing...Ch. 17 - How would you recommend accounting for variances...Ch. 17 - What does a manager learn by computing an industry...Ch. 17 - Why is there no efficiency variance for revenues?Ch. 17 - For what decisions would a manager want to know...Ch. 17 - If the sales activity or materials efficiency...Ch. 17 - Prob. 8RQCh. 17 - Prob. 9RQCh. 17 - What is the advantage of recognizing materials...
Ch. 17 - How could a professional sports firm use the mix...Ch. 17 - Prob. 12CADQCh. 17 - How could a hospital firm use the mix variance to...Ch. 17 - Prob. 14CADQCh. 17 - There is no reason to investigate favorable...Ch. 17 - Prob. 16CADQCh. 17 - Consider a firm in the sharing economy, such as...Ch. 17 - Prob. 18ECh. 17 - Prob. 19ECh. 17 - Prob. 20ECh. 17 - Variable Cost Variances: Materials Purchased and...Ch. 17 - Prob. 22ECh. 17 - Industry Volume and Market Share Variances DB Ice...Ch. 17 - Olive Tree Products sold 72,000 units during the...Ch. 17 - Prob. 25ECh. 17 - Sales Mix and Quantity Variances A-Zone Media...Ch. 17 - Prob. 27ECh. 17 - Sales Mix and Quantity Variances The restaurant at...Ch. 17 - Sales Mix and Quantity Variances Chow-4-Hounds...Ch. 17 - Materials Mix and Yield Variances Stacy, Inc.,...Ch. 17 - Materials Mix and Yield Variances Johns...Ch. 17 - Labor Mix and Yield Variances Matts Eat N Run has...Ch. 17 - Flexible Budgeting, Service Organization KB is a...Ch. 17 - Prob. 34ECh. 17 - Prob. 35ECh. 17 - Sales Price and Activity Variances EZ-Tax is a tax...Ch. 17 - Write a memo to the senior manager of EZ-Tax...Ch. 17 - Variable Cost Variances The standard direct labor...Ch. 17 - Refer to the information in Exercise...Ch. 17 - Prob. 40PCh. 17 - Variable Cost Variances: Materials Purchased and...Ch. 17 - Industry Volume and Market Share Variances:...Ch. 17 - Industry Volume and Market Share: Missing Data The...Ch. 17 - Sales Mix and Quantity Variances Lake Cellars...Ch. 17 - Analyze Performance for a Restaurant Dougs Diner...Ch. 17 - Nonmanufacturing Cost Variances FSBCU is a...Ch. 17 - Performance Evaluation in Service Industries Bay...Ch. 17 - Refer to the information in Problem...Ch. 17 - Prob. 49PCh. 17 - Refer to the data for the Peninsula Candy Company...Ch. 17 - Materials Mix and Yield Variances Plano Products...Ch. 17 - Pinnuck Products makes a liquid solvent using two...Ch. 17 - Labor Mix and Yield Variances Matthews Bros, is a...Ch. 17 - Refer to the information in Problem...Ch. 17 - Derive Amounts for Profit Variance Analysis...Ch. 17 - Flexible Budget Oak Hill Township operates a motor...
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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
- A flexible budget______. A. predicts estimated revenues and costs at varying levels of production B. gives actual figures for selling price C. gives actual figures for variable and fixed overhead D. is not used in overhead variance calculationsarrow_forwardGross profit variance analysis can be used to study the effect of: " Changes in cost of goods sold on a company's profitability. O Changes in product sales mix on a company's profitability. Changes in selling prices on a company's profitability. O All of the choices. O Changes in volume of goods sold on a company's profitability.arrow_forwardS1: Cost price variance is computed by deducting cost of sales this year at last year's cost price from cost of sales this year. S2: Sales this year at last year's price is the same as sales last year at this year's quantity. A. both are true C. S1 is true D. S2 is true B. both are falsearrow_forward
- 2 no Question Requirement: Compute the following: (i) Material price Purchase variance (ii) Material price usage variance (iii) Material Quantity variance (iv) Material total variance (v) Labor rate variance (vi) Labor efficiency variance (vii) Labor total variance (viii) Variable Spending variance. (ix) Variable Efficiency variance (x) Variable total variancearrow_forwardWhich of the following is true? Multiple Choice If a company has an unfavorable spending variance, it must have an unfavorable price variance. If a company has a favorable spending variance, it may have a favorable or unfavorable rate variance. If a company has a favorable quantity variance, it will have a favorable price variance. If a company has an unfavorable efficiency variance, it spent more per labor hour than budgeted.arrow_forwardFast solve plzarrow_forward
- Total operating income variance means the difference between the actul operating inccome and the operating income of the master budget. Operating profit variance only determines the results of operation and excludes financing and other profits and losses. The total operating income variance is also known as sales volume variance which results in difference in the gross profit and difference in booking of other overheads costs due to difference arising in sales and closing inventory values. Questions1. What would be a first-level breakdown of the total operating income variance? 2. How can the total flexible-budget variance be broken down (i.e., what are the constituent parts of this total variance)?arrow_forwardWhich of the following statements about margin of safety is false? a. Margin of safety measures the difference between budgeted revenues and breakeven revenues. b. If the variable cost per unit decreases but the number of units sold, unit selling price and total fixed cost are all constant, the margin of safety decreases. c. If only the fixed costs decrease but the number of units sold and unit selling price and unit variable cost are all constant, the margin of safety increases. d. If only the fixed costs increase but the number of units sold and unit selling price and unit variable cost are all constant, the margin of safety decreases. e. none of the given answers is false.arrow_forwardA flexible budget ( check all that apply): a. Separates variable costs from fixed costs b. Shows reevenues and expenses for varous levels of sales volume c. Reports variable costs on a per unit basis d. Reports fixed costs on a oer unit basisarrow_forward
- Bulldogs Inc. wants to determine the impact of the change in selling price of its sole product in relation to the analysis of its gross profit. Which of the following must the company determine? a. Sales Volume Variance b. Cost Price Variance c. Volume Variance d. Sales Price Variancearrow_forwardWhich statement may not always hold true? A. Increase in the units sold always lead to unfavorable cost volume variance. B. Increase in sales price will always lead to favorable sales variance. C. In a multi-product company, the gross profit volume variance can be further analyzed into sales mix variance and final sales volume variance. D. Decrease in unit production cost will always lead to favorable cost price variance. E. Answer not givenarrow_forwardWhich of the following statements is false? a. The sum of the sales volume variance and cost volume variance should be equal to the sum of the sales mix variance and final sales volume variance in a 4-way variance analysis. b. Gross profit variance analysis can be used to assess the effectiveness of the company’s purchasing policies, pricing and mark-up policies. c. There will be a unfavorable sales price variance is the actual sales price is lower than the base sales price. d. There will be a unfavorable cost volume variance if the actual sales volume is less than the base sales volume.arrow_forward
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What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY