Calculate the sales-mix variance for each product

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Reference no: EM13341343

Acme Manufacturing manufactures and sells three products. The following information pertains to Acme's 2012 sales and operations.

 

Budgeted sales in units

Budgeted selling price per unit

Light

8,000

$140.00

Best

3,900

$200.00

Supreme

3,900

$400.00

Budgeted variable cost per unit

$95.00

$165.00

$385.00

Budgeted Fixed Costs

$350,000

 

 

 

Actual sales in units

 

6,935

 

4,194

 

5,000

Actual selling price per unit

$150.00

$175.00

$385.00

Actual variable cost per unit

$100.00

$127.50

$365.00

Actual Fixed Costs

$400,000

 

 

1. Calculate the sales-volume variance for each product and in total.

2. Calculate the sales-mix variance for each product and in total.

3. Calculate the sales-quantity variance for each product and in total.

4. Assume Acme estimated that its budgeted sales would be 12.0% of the total market share for this line of products in the Twin Cities metropolitan area for 2012. Reliable industry data indicates that the actual market size was 180,000 for these kinds of products sold for the geographic area in 2012.

a. Compute the market-share variance for 2012.

b. Compute the market-size variance for 2012.

5. As the management accountant preparing and presenting this information to upper management, What is the primary operating result/issue you express to upper management about this analysis?

Reference no: EM13341343

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