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# CHAPTER 14 - page 44 / 62

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14-34(40 min.)   Variance analysis, multiple products.

1, 2, and 3.   Solution Exhibit 14-34 presents the sales-volume, sales-quantity, and sales-mix variances for each type of cookie and in total for Debbie's Delight Inc. in August 2003.

The sales-volume variances can also be computed as:

= ×

The sales-volume variances are:

Chocolate chip=(57,600 – 45,000) \$2.00=\$25,200 F

##### Oatmeal raisin=(18,000 – 25,000)  \$2.30=16,100 U

Coconut=  (9,600 – 10,000) \$2.60=1,040 U

##### White chocolate=(13,200 –   5,000)  \$3.00=24,600 F

Macadamia nut=(21,600 – 15,000) \$3.10=  20,460 F

All cookies\$53,120 F

The sales-quantity variance can also be computed as :

=

The sales-quantity variances are:

Chocolate chip=(120,000 – 100,000) 0.45 \$2.00=\$18,000 F

Oatmeal raisin=(120,000 – 100,000) 0.25 \$2.30=11,500 F

Coconut=(120,000 – 100,000) 0.10 \$2.60=  5,200 F

White chocolate=(120,000 – 100,000) 0.05 \$3.00=  3,000 F

Macadamia nut=(120,000 – 100,000) 0.15 \$3.10=    9,300 F

All cookies\$47,000 F

The sales-mix variance can also be computed as:

=

The sales-mix variances are:

Chocolate chip=(0.48 – 0.45) 120,000 \$2.00 =\$   7,200 F

##### Coconut=(0.08 – 0.10)  120,000  \$2.60=     6,240 U

White chocolate=(0.11 – 0.05) 120,000 \$3.00=   21,600 F

Macadamia nut=(0.18 – 0.15) 120,000 \$3.10=   11,160 F

All cookies\$   6,120 F

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