Solution-Prepare an analysis of the sales quantity and unit

Prepare an analysis of the sales quantity and unit price

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Reference no: EM132685930

Problem - Contribution margin analysis-sales - Blueberry, Inc., sells computer equipment. Management decided early in the year to reduce the price of the speakers in order to increase sales volume. As a result, for the year ended December 31, 2013, the sales increased by $17,500 from the planned level of $1,182,500. The following information is available from the accounting records for the year ended December 31, 2013:

Actual

Planned

Increase or (Decrease)

Sales

Number of units sold

Sales price

Variable cost per unit

$1,200,000

48,000

$25.00

$5.00

$1,182,500

43,000

$27.50

$5.00

$17,500

5,000

$(2.50)

Required -

a. Prepare an analysis of the sales quantity and unit price factors.

b. Did the price decrease generate sufficient volume to result in a net increase in contribution margin if the actual variable cost per unit was $5, as planned?

Reference no: EM132685930

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Prepare an analysis of the sales quantity and unit price

Reference no: EM132685930

Reference no: EM132685930

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