Sales variance analysis Bakery Extraordinaire sells several types of muffins and scones and also sells carrot bread loaves. Planned prices and sales quantities for February are shown here:
PLANNED SALES FOR FEBRUARY
MUFFINS
SCONES
CARROT BREAD
TOTALS
Unit price
$1.35
$1.75
$2.75
Unit sales
1,600
3,400
1,000
6,000
Total
$2,160
$5,950
$2,750
$10,860
The actual results for February are shown here:
ACTUAL SALES FOR FEBRUARY
$1.55
$1.60
$3.25
1,400
4,500
1,300
7,200
$2,170
$7,200
$4,225
$13,595
The owner would like to know how the price changes and volume changes each contributed to the $2,735 difference between planned and actual sales revenues.
Required
(a) Compute the sales mix variance for each product line and explain the meaning of each variance you computed.
(b) Compute the sales quantity variance for each product line and explain the meaning of each variance you computed.
(c) Compute the sales price variance for each product line and explain the meaning of each variance you computed.
Already registered? Login
Not Account? Sign up
Enter your email address to reset your password
Back to Login? Click here