Acct 222 Case Study
Essay by amato282 • August 8, 2017 • Case Study • 2,597 Words (11 Pages) • 933 Views
ACCT 222 PROBLEM NO 3 (21/09/2016)
(Solution)
(i). Budgeted and actual income statements
Budgeted $ | Actual $ | |||
Sales - Male | 30000 | 16000 | ||
Sales - Female | 18000 | 40000 | ||
Total sales | 48000 | 56000 | ||
Commission - Male | 12000 | 7000 | ||
Commission - Female | 10000 | 22000 | ||
Total commission | 22000 | 29000 | ||
Fixed cost | 20000 | 24000 | ||
Profit | 6000 | 3000 |
(ii)
Sales mix variances
Actual sales volume | Actual sales in budgeted proportions | Difference | Standard CM | Sales mix variance |
Male 2000 | 3200 (80%) | (1200) | $ 4.50 | ($ 5400) U |
Female 2000 | 800 (20%) | 1200 | $ 8.00 | $ 9600 F |
Total sales mix variance | $ 4200 F |
Sales quantity variances
Actual sales volume in budgeted proportions | Budgeted sales quantity | Difference | Standard CM | Sales quantity variance |
Male 3200 (80%) | 4000 | (800) | $ 4.50 | ($ 3600) U |
Female 800 (20%) | 1000 | (200) | $ 8.00 | ($ 1600) U |
Total sales quantity variance | ($ 5200) U |
Sales volume variance
Sales mix variance | Sales quantity variance | Sales volume variance | |
Male | ($ 5400) U | ($ 3600) U | (9000) U |
Female | $ 9600 F | ($ 1600) U | 8000 F |
Total | $ 4200 F | ($ 5200) U | 1000 U |
Or presented as we did in class
Sales Mix and Sales Quantity Variances
Male
Flexible Budget Static Budget
AQall x Amix x BUCM AQall x Bmix x BUCM BQall x Bmix x BUCM
2000 x $4.50 3200 x $4.50 4000 x $4.50
$9000 $14400 $18000
[pic 1][pic 2][pic 3][pic 4][pic 5][pic 6]
Sales Mix Variance Sales Quantity Variance[pic 7]
$5400 U $3600 U
[pic 8][pic 9][pic 10]
Sales volume variance
$9000 U
Female
Flexible Budget Static Budget
AQall x Amix x BUCM AQall x Bmix x BUCM BQall x Bmix x BUCM
$2000 x $8.00 $800 x $8.00 $1000 X $8.00
$16000 $6400 $8000
[pic 11][pic 12][pic 13][pic 14][pic 15][pic 16]
Sales Mix Variance Sales Quantity Variance[pic 17]
$9600 F $1600 U
[pic 18][pic 19][pic 20]
Sales volume variance
$8000 F
Total SMV = $4200F SQV= $5200U
SVV = $1000U
(iii) Sales price variances
Sales price variances - Male ($8.00-$7.50) x 2000 $1000 F
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