{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

# CN14HO - Sales-Variance Analysis Chapter 14 2008 Foster...

This preview shows pages 1–8. Sign up to view the full content.

2008 Foster School of Business Accounting 311 L.DuCharme 1 Sales-Variance Analysis Chapter 14

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
2008 Foster School of Business Accounting 311 L.DuCharme 2 Calculation of sales variances
2008 Foster School of Business Accounting 311 L.DuCharme 3 Overview of “Sales” variances Actual Flexible Static Budget Budget |----- Flex. V .-----|-------------- Sales-volume V .---------------| | --- Sales-Mix V .--- | ----------- Sales-Quant.V .------------ | | -- Mkt.-share V . -- | -- Mkt.-size V.-- | Actual Mkt. size x Actual Mkt. share x Actual sales mix x Actual CM /unit Actual Mkt. size x Actual Mkt. share x Actual sales mix x Budget CM /unit Actual Mkt. size x Actual Mkt. share x Budget sales mix x Budget CM /unit Actual Mkt. size x Budget Mkt. share x Budget sales mix x Budget CM /unit Budget Mkt. size x Budget Mkt. share x Budget sales mix x Budget CM /unit

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
2008 Foster School of Business Accounting 311 L.DuCharme 4 Things to note: (1) Total number of units of all products sold = market size * market share (2) Number of each product sold = market size * market share * sales mix (3) Average CM / unit = sales mix * CM / unit (4) “Revenue” variances can be calculated by substituting sales price for CM in all of the equations on the prior slide.
2008 Foster School of Business Accounting 311 L.DuCharme 5 Sales-Volume Variance Components The following information relates to English Languages Institute budget for the year 2003. Product Grammar Trans. Comp. Selling price per unit \$259 \$87 \$185 Variable cost 189 50 95 Contribution margin per unit \$ 70 \$37 \$ 90

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
2008 Foster School of Business Accounting 311 L.DuCharme 6 Sales-Volume Variance Components-budget Product Grammar Translation Composition Cont. margin \$70 \$37 \$90 × Units 3,185 980 735 = Total \$222,950 \$36,260 \$66,150 Sales mix 65% 20% 15% Total budgeted contribution margin = \$325,360
2008 Foster School of Business Accounting 311 L.DuCharme 7

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern