Based upon the following data taken from the records of Bruce Inc., prepare a co
ID: 2380037 • Letter: B
Question
Based upon the following data taken from the records of Bruce Inc., prepare a contribution margin analysis report for the year ended December 31, 2012.For Year Ended
December 31, 2012
Actual
Planned Difference
Increase
(Decrease) Sales $312,000 $325,000 $(13,000) Less: Variable cost of goods sold $169,200 $182,000 $(12,800) Variable selling and administrative
expenses
32,400
39,000
(6,600) Total $201,600 $221,000 $(19,400) Contribution margin $110,400 $104,000 $ 6,400 Number of units sold 120,000 130,000 (10,000) Per unit: Sales price $2.60 $2.50 .10 Variable cost of goods sold 1.41 1.40 .01 Variable selling and administrative
expenses
.27
.30
(.03) Based upon the following data taken from the records of Bruce Inc., prepare a contribution margin analysis report for the year ended December 31, 2012.
For Year Ended
December 31, 2012
Actual
Planned Difference
Increase
(Decrease) Sales $312,000 $325,000 $(13,000) Less: Variable cost of goods sold $169,200 $182,000 $(12,800) Variable selling and administrative
expenses
32,400
39,000
(6,600) Total $201,600 $221,000 $(19,400) Contribution margin $110,400 $104,000 $ 6,400 Number of units sold 120,000 130,000 (10,000) Per unit: Sales price $2.60 $2.50 .10 Variable cost of goods sold 1.41 1.40 .01 Variable selling and administrative
expenses
.27
.30
(.03) For Year Ended
December 31, 2012
Actual
Planned Difference
Increase
(Decrease) $312,000 $325,000 $(13,000) $169,200 $182,000 $(12,800)
32,400
39,000
(6,600) $201,600 $221,000 $(19,400) $110,400 $104,000 $ 6,400 120,000 130,000 (10,000) $2.60 $2.50 .10 1.41 1.40 .01
.27
.30
(.03) For Year Ended
December 31, 2012
Actual
Planned Difference
Increase
(Decrease) Sales $312,000 $325,000 $(13,000) Less: Variable cost of goods sold $169,200 $182,000 $(12,800) Variable selling and administrative
expenses
32,400
39,000
(6,600) Total $201,600 $221,000 $(19,400) Contribution margin $110,400 $104,000 $ 6,400 Number of units sold 120,000 130,000 (10,000) Per unit: Sales price $2.60 $2.50 .10 Variable cost of goods sold 1.41 1.40 .01 Variable selling and administrative
expenses
.27
.30
(.03)
Explanation / Answer
planned
total sales = 130000*2.50=325000
total variable cost=130000*(1.4+0.3)=221000
contribution margin=sales-variable cost=104000
actual
total sales=120000*2.60=312000
total variable cost=120000*(1.41+0.27)=201600
contribution margin = 110400
although actual sales is less than the planned sales by 13000
the cost incurred in actual is much less than planned difference being 19400
hence there is a better contribution margin in case of actual than planned