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Nanerty Inc. produces two types of backpacks: basic and deluxe. The basic backpack sells for $25 and the deluxe sells for $100. Nanerty is budgeting sales for 2010 of 1,000 basic backpacks and 650 deluxe. Variable costs associated with the basic backpack amount to $10 and $40 for the deluxe. Actual units sold were 1,200 basic and 550 deluxe.
Required:
Question a. Calculate the contribution margin variance
Question b. Calculate the sales mix variance
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