Company ABC had the following budget for Period 1:
|
Product Y |
Product Z |
|
|
Sales ( Units) |
3,000 |
27,000 |
|
$ |
$ |
|
|
Standard selling price |
30 |
7.50 |
|
Standard cost |
18 |
6.00 |
|
Standard profit |
12 |
1.50 |
|
Product Y |
Product Z |
|
|
Sales ( Units) |
9,000 |
24,000 |
|
$ |
$ |
|
|
Standard selling price |
31.50 |
6.75 |
|
Standard cost |
18.00 |
6.00 |
|
Profit |
13.50 |
0.75 |
(i) Calculate the:
(a) Sales margin (profit) price variance
(b) Sales margin (profit) mixture variance
(c) Sales margin (profit) quantity variance (15 marks)
(ii) In view of the actual results, state (with comments) what factors you would wish to investigate. ( 5 marks)
FCCA,CA(MIA)with more than 26 years of post-qualifying working experiences. Previous working stints with one of the big accounting four, Regional GFC & Group Treasurer in a group of Malaysian and Group CFO in Singapore public listed concern.
Also author to another very popular free educational accounting cum finance blog: http://basiccollegeaccounting.com under the branding of College Accounting Coach.
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