X hits on this document

# CHAPTER 14 - page 14 / 62

265 views

0 shares

14 / 62

14-22 (Cont'd.)

Sales-mix percentages:

Budgeted

Actual

Lower-tier

= 0.40

= 0.30

Upper-tier

= 0.60

= 0.70

Solution Exhibit 14-22 presents the sales-volume, sales-quantity, and sales-mix variances for lower-tier tickets, upper-tier tickets, and in total for Detroit Penguins in 2004.

The sales-quantity variances can also be computed as:

=

The sales-quantity variances are:

Lower-tier tickets=(11,000 – 10,000) × 0.40 × \$20=  \$8,000 F

Upper-tier tickets=(11,000 – 10,000) × 0.60 × \$  5=    3,000 F

All tickets\$11,000 F

The sales-mix variance can also be computed as:

=  ×

The sales-mix variances are:

Lower-tier tickets=11,000 × (0.30 – 0.40) × \$20=\$22,000 U

Upper-tier tickets=11,000 × (0.70 – 0.60) × \$  5=    5,500 F

All tickets\$16,500 U

3.The Detroit Penguins increased average attendance by 10% per game.  However, there was a sizable shift from lower-tier seats (budgeted contribution margin of \$20 per seat) to the upper-tier seats (budgeted contribution margin of \$5 per seat).  The net result: the actual contribution margin was \$5,500 below the budgeted contribution margin.

 Document views 265 Page views 266 Page last viewed Tue Jan 24 20:18:58 UTC 2017 Pages 62 Paragraphs 2332 Words 13486