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    Solution Exhibit 14-27: Budgeted Contribution Margin Per Unit

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    Elliot Richard
    The document contains calculations for sales-mix and sales-quantity variances for two products, Kola and Limor, sold by Soda King in 2017. It shows Kola had a favorable sales-mix variance of $55,350 while Limor had an unfavorable variance of $43,050, resulting in a total favorable sales-mix variance of $12,300. It also states there was an unfavorable sales-quantity variance of $78,000 due to 20,000 fewer units sold than budgeted.

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    Solution Exhibit 14-27: Budgeted Contribution Margin Per Unit

    Uploaded by

    Elliot Richard
    19 views1 page
    The document contains calculations for sales-mix and sales-quantity variances for two products, Kola and Limor, sold by Soda King in 2017. It shows Kola had a favorable sales-mix variance of $55,350 while Limor had an unfavorable variance of $43,050, resulting in a total favorable sales-mix variance of $12,300. It also states there was an unfavorable sales-quantity variance of $78,000 due to 20,000 fewer units sold than budgeted.

    Original Description:

    WINDANG KA

    Original Title

    COURSE 3

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    The document contains calculations for sales-mix and sales-quantity variances for two products, Kola and Limor, sold by Soda King in 2017. It shows Kola had a favorable sales-mix variance of $55,350 while Limor had an unfavorable variance of $43,050, resulting in a total favorable sales-mix variance of $12,300. It also states there was an unfavorable sales-quantity variance of $78,000 due to 20,000 fewer units sold than budgeted.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    19 views1 page

    Solution Exhibit 14-27: Budgeted Contribution Margin Per Unit

    Uploaded by

    Elliot Richard
    The document contains calculations for sales-mix and sales-quantity variances for two products, Kola and Limor, sold by Soda King in 2017. It shows Kola had a favorable sales-mix variance of $55,350 while Limor had an unfavorable variance of $43,050, resulting in a total favorable sales-mix variance of $12,300. It also states there was an unfavorable sales-quantity variance of $78,000 due to 20,000 fewer units sold than budgeted.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    Actual units of  Actual Budgeted  Budgeted

    Sales-mix all products  sales-mix sales-mix  contribution margin


     percentage percentage 
    variance = sold   –  per unit

    Kola = 1,230,000 × (0.41 – 0.40) × $4.50 = $55,350 F


    Limor = 1,230,000 × (0.59 – 0.60) × $3.50 = 43,050 U
    Total $12,300 F

    2. The breakdown of the unfavorable sales-volume variance of $65,700 shows that the biggest
    contributor is the 20,000 unit decrease in sales resulting in an unfavorable sales-quantity variance of
    $78,000. There is a partially offsetting favorable sales-mix variance of $12,300 in contribution
    margin as a result of the sales mix shifting in favor of the more profitable Kola (contribution margin
    of $4.50 versus contribution margin of $3.50 for Limor).

    SOLUTION EXHIBIT 14-27


    Sales-Mix and Sales-Quantity Variance Analysis of Soda King for 2017

    Flexible Budget: Static Budget:


    Actual Units of Actual Units of Budgeted Units of
    All Products Sold All Products Sold All Products Sold
     Actual Sales Mix  Budgeted Sales Mix  Budgeted Sales Mix
     Budgeted Contribution  Budgeted Contribution  Budgeted Contribution
    Margin Per Unit Margin Per Unit Margin Per Unit

    Kola 1,230,000  0.41  $4.50 = $2,269,350 1,230,000  0.4  $4.50 =


    $2,214,000 1,250,000  0.4  $4.50 = $2,250,000
    Limor 1,230,000  0.59  $3.50 = 2,539,950 1,230,000  0.6  $3.50 =
    2,583,000 1,250,000  0.6  $3.50 = 2,625,000
    $4,809,300 $4,797,000

    $ 12,300 F $ 78,000 U
    Sales-mix variance Sales-quantity variance

    $65,700 U
    Sales-volume variance

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