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Change in cost absorption difference

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An analysis of Cost/Sales % (C/S%). At the same time, Compare it with previous month's C/S%. Below is my case. Say, Jan'12 C/S% = 13.1%, Feb'12 C/S% = 15.8% (Increase by 2.7% - 15.8% minus 13.1%) Jan'12 Sales = $8,465,000, Cost = $1,112,099 Feb'12 Sales = $865,156, Cost = $136,786

Required to work out the reason for the change, and the movement analysis of Sales and Cost have been performed.

The movement as follows:

1) Selling Price Decreased by $2,844

2) Cost Increased by $937

3) Change in Sales Mix - Sales reduced by $7,597,000 and Cost reduced by $1,010,000

4) Change in Cost Absorption difference - Cost increased by $33,750

Reference no: EM13334999

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