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79. Folsom Fashions sells a line of women's dresses. The company uses flexible budgets to
analyze its performances. The firm's performance report for November is presented below:
Actual Budget
Dresses sold 5,000 6,000
Sales $235,000 $300,000
Variable costs 145,000 180,000
Contribution margin $90,000 $120,000
Fixed costs 84,000 80,000
Operating income $6,000 $40,000
The selling price variance for November is:
80. Folsom Fashions sells a line of women's dresses. The company uses flexible budgets to
analyze its performances. The firm's performance report for November is presented below:
Actual Budget
Dresses sold 5,000 6,000
Sales $235,000 $300,000
Variable costs 145,000 180,000
Contribution margin $90,000 $120,000
Fixed costs 84,000 80,000
Operating income $6,000 $40,000
What additional information would be needed for Folsom to calculate the dollar impact of
changes in market share on November's operating income?
81. Duo, Inc., carries two products and has the following year-end income statement (000s
omitted):
Product AR-10 Product ZR-7
Budget Actual Budget Actual
Units 2,000 2,800 6,000 5,600
Sales $ $6,000 $7,560 $12,000 $11,760
Variable costs 2,400 2,800 6,000 5,880
Fixed Costs 1,800 1,900 2,400 2,400
Total Costs $4,200 $4,700 $8,400 $8,280
Operating income $1,800 $2,860 $3,600 $3,480
The net effect of AR-10's sales volume variance on profit is:
82. Duo, Inc., carries two products and has the following year-end income statement (000s
omitted):
Product AR-10 Product ZR-7
Budget Actual Budget Actual
Units 2,000 2,800 6,000 5,600
Sales $ $6,000 $7,560 $12,000 $11,760
Variable costs 2,400 2,800 6,000 5,880
Fixed Costs 1,800 1,900 2,400 2,400
Total Costs $4,200 $4,700 $8,400 $8,280
Operating income $1,800 $2,860 $3,600 $3,480
The net effect of ZR-7's selling price variance on profit is:
83. Duo, Inc., carries two products and has the following year-end income statement (000s
omitted):
Product AR-10 Product ZR-7
Budget Actual Budget Actual
Units 2,000 2,800 6,000 5,600
Sales $ $6,000 $7,560 $12,000 $11,760
Variable costs 2,400 2,800 6,000 5,880
Fixed Costs 1,800 1,900 2,400 2,400
Total Costs $4,200 $4,700 $8,400 $8,280
Operating income $1,800 $2,860 $3,600 $3,480
If products AR-10 and ZR-7 are substitutes for each other, a sales mix and sales volume
variation for the combined products can be calculated. If this combination is calculated, the net
effect on profit of the change in the unit sales mix is: (Round intermediate calculations to five
significant digits, and your final answer to the nearest whole dollar amount.)
84. Duo, Inc., carries two products and has the following year-end income statement (000s
omitted):
Product AR-10 Product ZR-7
Budget Actual Budget Actual
Units 2,000 2,800 6,000 5,600
Sales $ $6,000 $7,560 $12,000 $11,760
Variable costs 2,400 2,800 6,000 5,880
Fixed Costs 1,800 1,900 2,400 2,400
Total Costs $4,200 $4,700 $8,400 $8,280
Operating income $1,800 $2,860 $3,600 $3,480
The sales quantity variance that would complement the variance calculated in the previous
question is:
85. TV Timers, Inc., manufactures time control devices for TV's. The firm has the following
operating data for its operations in July:
Actual market size 10,000
Budgeted market size 11,250
Actual market share 34%
Budgeted market share 32%
Budgeted average contribution margin $6
Actual average contribution margin $5.25
What is the company's market share variance?
86. TV Timers, Inc., manufactures time control devices for TV's. The firm has the following
operating data for its operations in July:
Actual market size 10,000
Budgeted market size 11,250
Actual market share 34%
Budgeted market share 32%
Budgeted average contribution margin $6
Actual average contribution margin $5.25
What is the company's market size variance?
87. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
The weighted-average budgeted contribution margin per unit is:
88. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
The market share variance is:
89. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
The market size variance is:
90. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
Total sales quantity variance is:
91. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
If fixed costs are budgeted for $500,000 and are actually $500,000, what is the difference
between budgeted and actual operating income?
92. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
The total contribution margin sales volume variance of the period is:
93. Jackson, Inc., manufactures two products that it sells to the same market. Excerpted
below are its budgeted and actual operating results for the year just completed:
Unit sales Budged Actual
Product X 22,500 42,000
Product Y 90,000 80,000
Unit contribution margin
Product X $4.80 $3.90
Product Y $13.00 $14.00
Unit selling price
Product X $13.00 $14.00
Product Y $30.00 $29.00
Industry volume was estimated to be 1,875,000 units at the time the budget was prepared.
Actual industry volume for the period was 2,440,000 units. Jackson measures variances using
contribution margin.
The total selling price variance of the period is:
94. Hollaway Corp. has the following data for the current fiscal year:
Actual Budget
Sales Units
Product X 20,000 90,000
Product Y 140,000 110,000
Total 160,000 200,000
Contribution Margin
Product X $9.00 $8.00
Product Y $6.00 $5.00
The total sales mix variance for both products is:
95. Hollaway Corp. has the following data for the current fiscal year:
Actual Budget
Sales Units
Product X 20,000 90,000
Product Y 140,000 110,000
Total 160,000 200,000
Contribution Margin
Product X $9.00 $8.00
Product Y $6.00 $5.00
The total sales quantity variance for both products is:
96. Hollaway Corp. has the following data for the current fiscal year:
Actual Budget
Sales Units
Product X 20,000 90,000
Product Y 140,000 110,000
Total 160,000 200,000
Contribution Margin
Product X $9.00 $8.00
Product Y $6.00 $5.00
The weighted-average budgeted contribution margin per unit is:
