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14-23 (Cont’d.)

Solution Exhibit 14-23

Columnar Presentation of Sales-Volume, Sales-Quantity and Sales-Mix Variances

for Jinwa Corporation

Flexible Budget:

Actual Units Sold

of All Glasses

Actual Sales Mix

Budgeted Contribution

Margin per Unit

Actual Units Sold

of All Glasses

Budgeted Sales Mix

Budgeted Contribution

Margin per Unit

Static Budget:

Budgeted Units Sold

of All Glasses

Budgeted Sales Mix

Budgeted Contribution

Margin per Unit

Panel A:

Plain

(1,500 0.6) $2

         900 $2

(1,500 0.8) $2

1,200 $2

(2,000 0.8) $2

1,600 $2

$1,800$2,400$3,200

$600 U$800 U

Sales-mix varianceSales-quantity variance

$1,400 U

Sales-volume variance

Panel B:

Chic

(1,500 0.4) $6

          600 $6

   (1,500 0.2) $6

   300 $6

 (2,000 0.2) $6

           400 $6

$3,600   $1,800$2,400

$1,800 F$600 U

Sales-mix varianceSales-quantity variance

$1,200 F

Sales-volume variance

Panel C:

All Glasses

$5,400$4,200$5,600

$1,200 F$1,400 U

Total sales-mix varianceTotal sales-quantity variance

$200 U

Total sales-volume variance

F = favorable effect on operating income;  U = unfavorable effect on operating income.

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