Doug Ramirez owns a chain of travel goods stores. Last year, his sales staff sold 20,000 suitcases at an average sale price of $190. Variable expenses were 75% of sales revenue, and the total fixed...

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Doug Ramirez owns a chain of travel goods stores. Last year, his sales staff sold 20,000 suitcases at an average sale price of $190. Variable expenses were 75% of sales revenue, and the total fixed expense was $250,000. This year, the chain sold more expensive product lines. Sales were 15,000 suitcases at an average price of $290. The variable expense percentage and the total fixed expenses were the same both years. Ramirez evaluates the chain manager by comparing this year’s income with last year’s income.
Requirement
1. Prepare a performance report for this year, similar to Exhibit 22-4. How would you improve Ramirez’s performance evaluation system to better analyze this year’s results?

Answered Same Day Dec 24, 2021

Solution

David answered on Dec 24 2021

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Doug Ramirez owns a chain of travel goods stores. Last year, his sales staff sold 20,000 suitcases at an average sale price of $190. Variable expenses were 75% of sales revenue, and the total fixed...

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